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ISP slapped with $807,000 fee for 'groundless' spam case

CAN-SPAM cuts both ways

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An internet service provider that has brought more than 20 lawsuits alleging spam abuses has been ordered to pay one of the defendants almost $807,000 for filing "groundless claims" that mired the company in years of costly litigation.

The $806,978.84 judgment was filed against Asis Internet Services, the same tiny ISP that earlier this month won an award of nearly $2.6m in a separate spam lawsuit. In the most recent case, Magistrate Judge Joseph C Spero of the US District Court of Northern California faulted Asis for pressing on with its case without proof that defendant Azoogle.com was the party that procured the spam at issue.

"Rather, it is apparent that Asis sued Azoogle based on little more than speculation that there might be a connection between those emails and Azoogle," Spero wrote in the decision, which was released late last week. "Asis then continued to litigate even as its discovery efforts turned up no evidence in support of its claims against Azoogle. Having initiated over 20 similar actions, and sued over 20 defendants in this action alone, an award of attorneys' fees here is necessary to deter Asis and other plaintiffs hoping to profit under the Can-Spam Act from casting such a wide net."

CAN-SPAM is short for the Controlling the Assault of Non-Solicited Pornography and Marketing Act, which was passed in 2003 to help stem the endless tide of spam that was clogging servers and inboxes of ISPs and the customers they served. It was designed to give spam opponents a powerful weapon by allowing them to collect damages of as much as $100 for every unsolicited email, with damages that can be tripled for a variety of reasons.

The decision in the Azoogle case reveals the dark side of such litigation as companies viewed as opportunists file dozens of suits with little merit. "The court also concludes that an award of fees advances the interests of compensation to the extent that defendant Azoogle was forced to defend itself against Asis's groundless claims, resulting in years of litigation and over a million dollars in attorneys' fees," Spero added.

The case is a reminder that parties suing under CAN-SPAM have plenty to lose if they bring cases that are later found to be baseless. Spero rejected Asis's argument that awards under CAN-SPAM should treat prevailing plaintiffs more favorably than prevailing defendants in determining whether fees and costs should be awarded.

A four-employee ISP in Garberville, California, Asis said it receives about 200,000 junk messages per day and spends about $3,000 per month to process them. ®

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