FTC Struggles To Gain Ground In War On Spam

But there is widespread agreement among experts that existing legal tools are insufficient for the task.

There is also a consensus that because of the ease with which spam crosses state lines, a national solution is needed.

But there is deep disagreement about what form new legislation should take.

In one camp are people like professor David Sorkin of John Marshall Law School who believe that current enforcement efforts are too narrowly focused on fraudulent and misleading spam, thus giving a kind of legitimacy and immunity to spam that is not misleading.

Sorkin favors a ban on all unsolicited commercial e-mail, though he concedes that finding workable definitions for those terms would be a thorny problem.

'That would be like throwing the baby out with the bathwater,' is how Robert Wientzen, president of the Direct Marketing Association, put the opposing view at the FTC's Spam Forum.

Wientzen claims that many consumers are happily making legitimate Internet purchases that they learned about through unsolicited e-mails.

FTC spokesperson Claudia Bourne Farrell said the agency has not taken a position on whether federal anti-spam legislation is necessary. She readily conceded that the agency doesn't have the wherewithal to tackle the whole problem.

Because the agency has no power to bring criminal prosecutions, it must usually settle for injunctions and perhaps some disgorgement of profits.

In a federal case that the agency settled last October, Cyber Data, a company that sells lists of e-mail addresses, agreed to pay $20,000 and to cease solicitations that promise unrealizable profits from using its lists. FTC v. Scott, No. 02120 [E.D. Calif.].

Questions About Priority

According to Sorkin, until six months ago, the FTC showed little awareness that the volume of spam was itself a problem. The agency still puts the emphasis on the content of spam.

Until six months ago, the FTC showed little awareness that the volume of spam was itself a problem.

In April of this year, for instance, it released a study showing that 66% of e-mail messages it sampled contained some falsity.

But at a recent press conference, the agency announced an initiative to frustrate mass spammers, fraudulent or not. The FTC and 17 other agencies will send letters to computer owners who have 'open relays.' The relays allow someone on the road to use a phone line to send and receive e-mail through a home-base computer. They are largely obsolete now that more secure methods are available, but those that remain in use are frequently hijacked by spammers to obscure the origin of their messages, thus reducing their risk of being blacklisted by Internet service providers. The FTC acknowledged that the agencies can only request that the relays be shut down since they are not illegal.

Spammers are not immune from serious consequences under existing law. New York Attorney General Eliot Spitzer recently arraigned Howard Carmack, known as the 'Buffalo Spammer,' on charges of identity theft. Also, Internet service provider Earthlink won an injunction and $16.4 million in damages against Carmack, who failed to appear for trial in an Atlanta federal court. Earthlink v. Carmack, No. 1:02-cv-3041 [N.D. Ga.].

Seattle solo practitioner Dietrich Biemiller has made something of a national reputation for himself by suing spammers under Washington state's 1998 anti-spam law, though he is little more than a year out of law school. Washington was the second of 30 states to adopt measures directed at spammers.

The bill allows spam recipients to recover $500 or more for each message that has misleading routing information or subject line.

Biemiller notes that whereas Washington law rarely allows punitive damages or attorney fees, the anti-spam law is an exception. None of his cases has gotten to the collection stage, but he is careful to target spammers with assets. Biemiller said that he probably has as many ongoing cases as many large Internet service providers have and wonders why they haven't been more aggressive in using the new law.

State Pre-emption

Paula Selis, senior counsel in the Washington attorney general's office, said it has used the law to win settlements that put spammers out of business. She said that Attorney General Christine Gregoire would welcome federal action against spammers but is alarmed that most proposals would pre-empt state laws that exceed the scope of federal law. In April, Gregoire joined 43 other attorneys general in urging Congress to avoid unnecessary pre-emption.

Biemiller is particularly concerned that leading proposals would prevent private individuals from suing spammers for damages and thereby leave all enforcement up to overburdened government agencies.

For Sorkin, the problem with many proposals, like the one requiring that spam be clearly labeled as advertising, is that they legitimate the spam industry.

Gary Young is a reporter for The National Law Journal.

Get rich suing spammers or your money back! If offers like that get your goat, you are not alone.

Angry consumers forward about 130,000 spam messages to the Federal Trade Commission every day, Chairman Timothy Muris said at the FTC's first Spam Forum. As recently as 2001, the average was just 10,000 per day, he said.

The FTC has stepped up its enforcement efforts in the past year. For instance, it announced the fourth in a series of joint federal-state sweeps directed at Internet fraud, including deceptive spam.

But there is widespread agreement among experts that existing legal tools are insufficient for the task.

There is also a consensus that because of the ease with which spam crosses state lines, a national solution is needed.

But there is deep disagreement about what form new legislation should take.

In one camp are people like professor David Sorkin of John Marshall Law School who believe that current enforcement efforts are too narrowly focused on fraudulent and misleading spam, thus giving a kind of legitimacy and immunity to spam that is not misleading.

Sorkin favors a ban on all unsolicited commercial e-mail, though he concedes that finding workable definitions for those terms would be a thorny problem.

'That would be like throwing the baby out with the bathwater,' is how Robert Wientzen, president of the Direct Marketing Association, put the opposing view at the FTC's Spam Forum.

Wientzen claims that many consumers are happily making legitimate Internet purchases that they learned about through unsolicited e-mails.

FTC spokesperson Claudia Bourne Farrell said the agency has not taken a position on whether federal anti-spam legislation is necessary. She readily conceded that the agency doesn't have the wherewithal to tackle the whole problem.

Because the agency has no power to bring criminal prosecutions, it must usually settle for injunctions and perhaps some disgorgement of profits.

In a federal case that the agency settled last October, Cyber Data, a company that sells lists of e-mail addresses, agreed to pay $20,000 and to cease solicitations that promise unrealizable profits from using its lists. FTC v. Scott, No. 02120 [E.D. Calif.].

Questions About Priority

According to Sorkin, until six months ago, the FTC showed little awareness that the volume of spam was itself a problem. The agency still puts the emphasis on the content of spam.

Until six months ago, the FTC showed little awareness that the volume of spam was itself a problem.

In April of this year, for instance, it released a study showing that 66% of e-mail messages it sampled contained some falsity.

But at a recent press conference, the agency announced an initiative to frustrate mass spammers, fraudulent or not. The FTC and 17 other agencies will send letters to computer owners who have 'open relays.' The relays allow someone on the road to use a phone line to send and receive e-mail through a home-base computer. They are largely obsolete now that more secure methods are available, but those that remain in use are frequently hijacked by spammers to obscure the origin of their messages, thus reducing their risk of being blacklisted by Internet service providers. The FTC acknowledged that the agencies can only request that the relays be shut down since they are not illegal.

Spammers are not immune from serious consequences under existing law. New York Attorney General Eliot Spitzer recently arraigned Howard Carmack, known as the 'Buffalo Spammer,' on charges of identity theft. Also, Internet service provider Earthlink won an injunction and $16.4 million in damages against Carmack, who failed to appear for trial in an Atlanta federal court. Earthlink v. Carmack, No. 1:02-cv-3041 [N.D. Ga.].

Seattle solo practitioner Dietrich Biemiller has made something of a national reputation for himself by suing spammers under Washington state's 1998 anti-spam law, though he is little more than a year out of law school. Washington was the second of 30 states to adopt measures directed at spammers.

The bill allows spam recipients to recover $500 or more for each message that has misleading routing information or subject line.

Biemiller notes that whereas Washington law rarely allows punitive damages or attorney fees, the anti-spam law is an exception. None of his cases has gotten to the collection stage, but he is careful to target spammers with assets. Biemiller said that he probably has as many ongoing cases as many large Internet service providers have and wonders why they haven't been more aggressive in using the new law.

State Pre-emption

Paula Selis, senior counsel in the Washington attorney general's office, said it has used the law to win settlements that put spammers out of business. She said that Attorney General Christine Gregoire would welcome federal action against spammers but is alarmed that most proposals would pre-empt state laws that exceed the scope of federal law. In April, Gregoire joined 43 other attorneys general in urging Congress to avoid unnecessary pre-emption.

Biemiller is particularly concerned that leading proposals would prevent private individuals from suing spammers for damages and thereby leave all enforcement up to overburdened government agencies.

For Sorkin, the problem with many proposals, like the one requiring that spam be clearly labeled as advertising, is that they legitimate the spam industry.

Gary Young is a reporter for The National Law Journal.