Court: NY Marketer Subject To Maryland Spam Law

by Wendy Davis, Jan 30, 2006, 11:16 AM

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An appellate court in Maryland last week reinstated a spam lawsuit against a New York-based Internet marketing company, rejecting the company's argument that subjecting it to Maryland's anti-spam law would burden interstate commerce.

The closely watched case is one of a growing number of decisions about whether individual states can enforce e-mail laws against out-of-state marketers. About three dozen states have their own laws regulating e-mail. To date, appellate courts in Washington and California have also ruled that those states' anti-spam laws don't unduly restrict commerce between states.

The lawsuit accused First Choice of violating Maryland's anti-spam laws because, allegedly, its e-mails contained misleading subject lines and didn't have valid return addresses. The case did not involve the federal Can-Spam law, which requires working opt-out links, as opposed to return addresses.

First Choice argued that it shouldn't be liable under Maryland's anti-spam law because it couldn't have foreseen that its e-mails would be opened in Maryland. The company asserted that forcing it to comply with a Maryland state law, when it had no contact with the state, would wreak havoc with interstate commerce. A trial judge accepted that argument and dismissed the case before trial in late 2004.

But Court of Special Appeals Judge Sally D. Adkins discounted that claim, writing that the company's e-mails didn't find their way into Maryland. "Rather," Adkins wrote, "First Choice directly caused the e-mails to be sent to Maryland."

She added that First Choice could have predicted that its e-mails would be opened in Maryland, ruling that claims to the contrary have "little more validity than one who contends he is not guilty of homicide when he shoots a rifle into a crowd of people without picking a specific target."

The case was brought by anti-spam activist Eric Menhart, at the time a third-year law student at George Washington Law School. Menhart argued that First Choice violated Maryland's anti-spam law by sending a consumer protection firm Menhart founded--MaryCLE, pronounced "miracle"--around two unsolicited e-mails a day between Sept. 18 and Oct. 29 of 2003. Some of the e-mails also contained allegedly misleading subject lines.

Menhart attempted to contact the sender about 80 times by e-mail, and also sent letters by U.S. postal mail to First Choice's president, but never clicked on the unsubscribe link in the e-mails to opt-out of receiving them. Andrew Dansicker, who represented First Choice, previously told OnlineMediaDaily that the e-mails complied with the federal Can Spam law, and denied that the subject lines contained fraudulent statements.

The case will now to back to a lower court for trial, unless First Choice appeals to a higher court.

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