Federal Trial Court Shoots Down Another CAN-SPAM Lawsuit

Last week, another federal trial court dismissed CAN-SPAM claims on standing grounds.  (Access Judge Bryan's order here [pdf] - h/t Prof. Goldman.)

This lawsuit (prosecuted by Gordon's former lawyer (or lawyers?)) involved claims under CAN-SPAM and Washington's email statute.  Judge Bryan ruled that although plaintiff was the provider of an internet access service, plaintiff did not put forth sufficient evidence that plaintiff suffered "adverse effects" as a result of the emails at issue.  Judge Bryan also dumps the state law claims on preemption (Mummagraphics) grounds. 

CAN-SPAM/Standing:  In the court's view, the plaintiff's case suffered from similar evidentiary flaws as Gordon's.  Plaintiff failed to put forth proof that he had increased costs at all (whether as a result of the specific emails at issue or otherwise):
Plaintiff has not shown that he has problems related to network functioning during the relevant time. . . . .  He does not own a server, but, at best, rents server space. He does not maintain or repair the servers or directly employ any one who repairs or maintains the servers. Any network harm that may result from the emails would likely be borne by Sonic.net. He has not shown that he had to invest in "new equipment to increase capacity," or new software due to the emails. . . . . He has made no showing that he had to hire "customer service personnel to deal with increased subscriber complaints." . . . . Plaintiff has only shown that he has chosen to switch from a dial up connection (at $18.95 per month) to a broadband connection (at $30.00 per month), a connection which he acknowledges is much faster. This negligible harm is insufficient to establish the "adverse effect" Congress intended to address.
Preemption:  The court's preemption analysis flows naturally from Mummagraphics and Gordon.  As a conceptual matter.  To the extent plaintiff's claims are premised on "bare error," they are preempted.  Plaintiff's claims again fail for evidentiary reasons:
The evidence in the record shows that the nine subject emails do contain the address 222 Grace Church Street # 302-100123, Port Chester, N.Y. 10573. . . . . There is evidence in the record that the municipal government of the Village of Port Chester New York uses the address of 222 Grace Church Street, Port Chester, N.Y. 10573. . . . . The record also shows that this is a building with multiple suites. . . . . There is evidence in the record that "My U.S. Postbox," a company which purports to provide postboxes for the receipt of letters and small parcels, provides its customers an address of 222 Grace Church Street # 302. . . . . Even viewing the evidence in a light most favorable to the Plaintiff, the record is insufficient to show more than "bare error," in the addresses listed on the subject emails, if that. Plaintiff has failed to show that there are genuine issues of material fact as to whether the subject emails "misrepresent [ ] or obscure[ ] any information in identifying the point of origin." RCW 19.190.020(1) . . . . .  [The] Court finds that while claims actually alleging falsity or deception under CEMA would not be preempted, Plaintiff's claims here--for at best incomplete or less than comprehensive information--are for immaterial errors that may not be litigated under state law.
The preemption issue was a little less satisfying to me, because, among other reasons, of the absence of mention of the recent CAN-SPAM regulations (which allow for use of PO Boxes and discuss multi-party emails).  It's tough to tell from the order, but it seemed like plaintiff's claims were focused on the fact that the defendant didn't transmit the emails - some third party did, and the emails didn't list who they were sent on behalf of or who they were sent by.  I haven't dug in closely to the CAN-SPAM regulations on this point, but it would have been nice to see an exhaustive analysis of the recent CAN-SPAM regulations in the context of the facts of this case.  (It seems at first blush that this case raises affiliate liability issues (see Prof. Goldman's article linked here) but that's not how the case played out.)  In any event, it seems like plaintiff could have eeked out a non-preempted claim here, at least at the summary judgment stage.

At the end of the day, the court didn't seem terribly persuaded that there was "anything there," and this is a fairly typical and defensible mode of adjudication. 

What's next?:  First, courts are making plaintiffs who bring CAN-SPAM claims work plenty hard, which should dissuade people from bringing suits.  Second, we're sure to see a Ninth Circuit ruling on the "adverse effect" issue fairly soon.  Hopefully, the court will issue a ruling that provides a roadmap for these cases (the bulk of which were decided correctly in my opinion).  Courts struggle with the core issue (as stated in the order) that CAN-SPAM contains an expansive definition of IAS, but Congress could not have intended anyone who provides someone else an email address to bring a lawsuit.  There's a line to be drawn here, I'm not sure how the Ninth Circuit will go about drawing it.  My gut feel tells me that one or two of these cases (maybe Asis) fell on the wrong side of the line.  (NB:  Plaintiff in this case cited Judge Henderson's Active Response Group decision (discussed here) but it obviously did not carry the day.)
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