“Spammers, beware! In a landmark victory as a California court awarded the social networking site MySpace astounding damages against a spammer.”
San Francisco — Social networking giant MySpace said Tuesday that it has won a record-setting $230 million legal judgment against two illustrious spammers who bombarded its members with spam.
A U.S. District Judge Audrey Collins handed down the landmark decision against Sanford Wallace and Walter Rines, after the notorious spam team failed to appear in court to pay MySpace a whopping 230 million dollars in what was being labeled Wednesday as a record-setting punishment for such Internet abuses.
According to news reports, the verdict in a Los Angeles U.S. District Court in favor of MySpace was delivered after the popular social-networking site filed suit against Sanford Wallace and Walter Rines because of junk e-mail they sent to MySpace members.
“Wallace and Rines used MySpace accounts to send more than 735,000 spam e-mails with links to sites that included pornography.”
“MySpace has zero tolerance for those who attempt to act illegally on our site,” Hemanshu Nigam, the social network site’s chief security officer, said in a statement. “We thank the court for serving justice upon defendants Wallace and Rines and we remain committed to punishing those who violate the law and try to harm our members.”
The decision is considered the biggest ever against spreader of unwanted, commercial e-mail, which is flooding inboxes everywhere.
“The judgment against the spammers is astronomical because each spam message entitles MySpace to $100 in damages under the terms of the Can-Spam Act,” said Graham Cluley, senior technology consultant at Sophos.
Collins imposed $157.4 million in damages against both Rines and Wallace and an additional $63.4 million against Rines under the 2003 CAN-SPAM Act.
In addition, Collins awarded MySpace $1.5 million against the duo under California’s anti-phishing law, as well as $4.7 million in attorney fees, and issued injunctions that prohibit further spamming activities in the future.
The CAN-SPAM Act of 2003, which limits per-message damages to $100. The Federal Trade Commission updated earlier this week to make it easier for consumers to determine who is sending e-mail marketing messages.
“In the war against spam it is right that large companies should have a heavy stick like this to hit the spammers with. But these two are just the tip of the iceberg.”
Even if MySpace were to extricate the fine from these two men, which seems unlikely given their past record, there will be plenty more cyber-criminals trying to make money from junk email.
“In the U.S. context, it might give a temporary break to people who get into that business,” said Peter Cassidy, secretary general of the Anti-Phishing Working Group. “It does say one thing, once you get big enough and start causing trouble with the elites; they will find a way to deal with you.”
Despite diminished chances that MySpace might recover any of the award, company officials maintain that the company hopes the decision will serve as a deterrent to future cyber criminals who are contemplating illicit spam activity for profit.
MySpace also has court case pending against high-profile spammer Scott Richter — another claimant to the “Spam King” throne — and Blue China Group, a Hong Kong-based entity that MySpace is pursuing in U.S. and Chinese courts.
In addition to court cases, the social networking play has undertaken other efforts to combat the problem of spammers, compiling a list of third-party sites that have been reported in connection with spammers or phishing scams.
In February, the company began showing warnings that appear when a user clicks on a link to one of these sites. The interstitial message warns that users are about to navigate to an off-site location that might not be safe.
“Experts assert that the decision might set a precedent for larger companies to start cracking down on spam that eats up time and resources.”
Hopefully it will go beyond spam, and go into other problems like electronic crime, said Cassidy. Companies understand that they have to police their community. Keeping it neat and orderly is doing their job; it is just the cost of doing business.