Stopping Spam?

A few weeks ago history was made in Iowa when Robert Kramer, whose company provides e-mail services, was awarded $1 billion in damages from spammers who hit the companies inbound mail servers up to 10 million times a day during parts of 2000.

Kramer filed suit against 300 spammers using an Iowa law that allows plaintiffs to claim damages of $10 per spam message received. Under RICO (Federal Racketeer Influenced and Corrupt Organizations Act) the judgments were tripled.

U.S. District Court Judge Charles Wolfe filed default judgments against AMP Dollar Savings Inc. of Mesa Ariz. (for $720 million), Cash Link Systems of Miami, Fla. (for $360 million), and TEI Marketing Group (for $140,000). While Kramer celebrated the victory as a way to fight against "lewd and malicious and fraudulent e-mail" his attorney pointed out that he is unlikely to ever collect the judgment. Kramer hopes to at least recover his legal costs.

On the same day, a state judge in Maryland threw out a suit on the grounds that it was unconstitutional citing that Maryland's Commercial Electronic Mail Act (MCEMA) was excessively broad and in violation of the commerce clause of the U.S. Constitution, which says that states can regulate commerce that crosses state lines or takes place in other states.



While the Iowa verdict stands as a victory for the foes of Spam, I can't help but wonder if it really provides a disincentive to spammers to cease their wicked ways. While a billion dollars is a great deal of money, not having to pay it because a spamming company no longer legally exists seems like a nice loophole and there would be little to keep any former spammer from relocating and starting again.

The base of the problem is that e-mail makes money, both for legitimate e-mail marketing companies and illegitimate entities that work off shore and from e-mail addresses scavenged from newsgroups. The economics are just too good: sending 10 million e-mails is about as costly as sending out a dozen. This means that if a 'campaign' yields a success rate of 0.00005 percent they have 500 possible leads to follow up on. The campaign will assuredly pay for itself.

One solution that has been embraced by every legitimate e-mailer I know is a postage system, backed by a registration system that would force all e-mailers to identify themselves and the servers they are using. Legitimate e-mailers embrace this type of system because they can make the economics work in their favor, while taking away the economic incentive for those wearing the black hats.

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