Gordon v. Virtumundo Inc et al

Filing 82

RESPONSE, by Defendants Virtumundo Inc, Adknowledge Inc, Scott Lynn, to 53 MOTION for Partial Summary Judgment. (Attachments: # 1 Exhibit A - Objections to Evidence)(Newman, Derek)

Gordon v. Virtumundo Inc et al

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 v. VIRTUMUNDO, INC, a Delaware corporation d/b/a ADNOWLEDGEMAIL.COM; ADKNOWLEDGE, INC., a Delaware corporation, d/b/a ADKNOWLEDGEMAIL.COM; SCOTT LYNN, an individual; and JOHN DOES, 1-X, Defendants. JAMES S. GORDON, Jr., a married individual, d/b/a `GORDONWORKS.COM'; OMNI INNOVATIONS, LLC., a Washington limited liability company, Plaintiffs,

The Honorable John C. Coughenour

UNITED STATES DISTRICT COURT WESTERN DISTRICT OF WASHINGTON AT SEATTLE NO. CV06-0204JCC DEFENDANTS' OPPOSITION TO PLAINTIFFS' MOTION FOR PARTIAL SUMMARY JUDGMENT NOTE ON MOTION CALENDAR: January 12, 2007

NEWMAN & NEWMAN, ATTORNEYS AT LAW, LLP

505 Fifth Ave. S., Ste. 610 Seattle, Washington 98104 [phone]

Dockets.Justia.com

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DEFS.' OPP'N TO MOT. FOR PARTIAL SUMM. J. CASE NO. CV06-0204C - i

TABLE OF CONTENTS

I. II.

INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 FACTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 A. B. Virtumundo Emails . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Relevant Procedural and Discovery History . . . . . . . . . . . . . . . . . . . . . . . 4

III.

ARGUMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 A. B. Summary judgment should be denied because there are disputed issues of material fact. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Plaintiffs lack standing to assert claims under CAN-SPAM because they are not a bona fide Internet access service provider adversely affected. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 1. Plaintiffs are not a bona fide Internet access service provider . . . . 7 2. Plaintiffs were not adversely affected by a violation of the statute . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Defendants qualify for the safe harbor because the alleged "from" lines identify the sender of the message. . . . . . . . . . . . . . . . . . . . . . . . . 11 CAN-SPAM does not require the "from name" to consist of a sender's "actual" name. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 1. Congress clearly did not intend to require a "from name" . . . . . . 14 2. Plaintiffs' position is not based on a permissible construction of the statute . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 Plaintiffs' state law claims do not establish any violation of CEMA, and CAN-SPAM preempts Plaintiffs' CEMA argument. . . . . . . . . . . . . 17 Plaintiffs fail to establish that Defendants are the initiators of the emails . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 Plaintiffs' purported evidence is inadmissible and should be stricken . . 20

C. D.

E. F. G. IV.

CONCLUSION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

NEWMAN & NEWMAN, ATTORNEYS AT LAW, LLP

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I. INTRODUCTION This motion arises out of Plaintiffs' Motion for Relief from Deadline (Docket. No. 42, the "Relief Motion") filed in response to Defendants' (still-pending) Motion for an Undertaking Pursuant to 15 U.S.C. § 7706(g)(4) (Dkt. No. 38, the "Motion for an Undertaking"). In the Relief Motion, Plaintiffs asserted that if excused from responding to the Motion for an Undertaking they planned to file a motion that would "result in the resolution of the ultimate issues in this case" (Relief Motion 2:11-12). Plaintiffs therefore requested "the opportunity to establish that as a matter of law . . . emails sent by, or on behalf of Defendants, do in fact violate the [CAN-SPAM] Act." (Relief Motion 3:11-12). This Court gave Plaintiffs the opportunity they requested (Dkt. No. 46). Far from filing a motion that would result in the resolution of this case, however, Plaintiffs filed the instant motion against Virtumundo only1 which they characterize as a "Motion for Partial Summary Judgment" (Dkt. No. 53, the "Motion"). The Motion addresses only a single non-dispositive issue, namely "[d]oes a commercial electronic mail message that does not accurately identify the sender of the email in the `From' field of the header comply with the CAN-SPAM ACT and/or CEMA" (Motion 3:19). Plaintiffs' novel theory that CAN-SPAM requires the "from name" field (in the "from" line) to contain the "actual name" of the sender is contrary to the plain language of CAN-SPAM, unworkable in practice, and without legal precedent. In fact, Plaintiff concedes uncertainty whether this sender would be the person who sent the email or the person who hired the Defendant to send it (Motion 3:15). Moreover, even if Plaintiffs were correct that CAN-SPAM contained such a requirement, Defendants' emails would not violate it. Every email Defendants send contains their domain name and a working email address in the "from line". The domain names Defendants use identify Defendants as the source of the message. In addition, Plaintiffs do not specify against which defendant(s) they move. However, the socalled "Relevant Facts" section addresses only defendant Virtumundo's alleged emails, and does not mention defendant Adknowledge or Mr. Lynn. See Motion 2:2 - 3:9.
DEFS.' OPP'N TO MOT. FOR PARTIAL SUMM. J. CASE NO. CV06-0204C - 1
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Defendants use the "from name" field to identify either (1) the line of business to which the email pertains, or (2) the actual name of the entity on whose behalf the email is initiated. Defendants' "from" line usages are expressly contemplated by CAN-SPAM and provide more (and more useful) information to recipients than does the interpretation Plaintiffs urge. Plaintiffs' position, if adopted, would result in more consumer confusion, not less, and would run contrary to the policies underlying CAN-SPAM. It would also create regulatory confusion in situations where a single email message contained promotions or solicitations from multiple and independent advertisers (which is the case with Defendant Adknowledge). Plaintiffs' argument that Defendants' "from name" usage is materially false or misleading is not only factually incorrect but legally frivolous. Plaintiffs' repeated rhetorical exhortations that various matters are "indisputable" notwithstanding, Plaintiffs cannot establish they are entitled to summary judgment on any of their claims 2 and their Motion should be denied. II. FACTS A. Virtumundo Emails Exhibit "A" to the Declaration of James Gordon in Support of Plaintiffs' Motion (Dkt. No. 64) consists of printouts of the emails upon which Plaintiffs' claims against defendant Virtumundo are based. (Motion 2:19-3:2). Although Virtumundo has not performed an exhaustive analysis of these emails, the vast majority of them include a return email address at one of the following domain names: <vm-mail.com>, <vmadmin.com>, and <virtumundo.com>. Declaration of Michael Shopmaker in Support of Opposition to Plaintiffs' Motion for Partial Summary Judgment ("Shopmaker Decl.")

Plaintiffs fail even to identify the elements of their claim, much less point to specific undisputed evidence in support of those elements. Plaintiffs' focus is entirely on the supposed "actual name of the sender" issue, and their motion is more accurately characterized as a motion for summary adjudication of that issue than as one for partial summary judgment.
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¶ 2. Virtumundo is the registrant (i.e., owner) of each of these domain names, and Virtumundo is identified in the WHOIS database as such. Shopmaker Decl. ¶ 3. The WHOIS database is a publically available source to identify the registrant of, and the registrant's contact information for, any .com domain name. Id. ¶ 4. The registrant provides its own contact information for the WHOIS database. Id. A WHOIS query on any of the domain names at issue in this case will return information including Virtumundo's name, correct physical address, and telephone number. Id. ¶ 5. Email senders who wish to obscure their identity may provide inaccurate contact information when registering domain names, or use "domain proxy" services to prevent their contact information from appearing in the WHOIS database. Shopmaker Decl. ¶ 6. Virtumundo does not engage in such practices, and indeed endeavors to make itself easy to identify and locate from the information in the "from" lines of the emails it sends. Id. ¶ 7. Every "from" line from Virtumundo contains (i) a working "from" email address that is attached to (ii) an accurate and truthful domain name that is registered to Virtumundo listed in WHOIS. Id. ¶ 8. In addition, the body of each email Virtumundo sends always includes accurate contact information for Virtumundo and working "unsubscribe" links. Id. In the course of its business, Virtumundo creates and transmits emails as part of promotional campaigns for its customers. Shopmaker Decl. ¶ 9. All of Virtumundo's email solicitations contain a working "from" email address that routes to Virtumundo. Virtumundo typically also uses the "from name" field to identify the customer. Id. In other circumstances, Virtumundo uses the "from name" field to identify the line of business to which the email pertains. Id. ¶ 10. Thus, an email advertising police training might have the "from name" of "Criminal Justice" followed by the email address at Virtumundo's domain, "[e-mail]". Id. This performs three functions. Id. ¶ 11. First, it informs the recipient that the message is a commercial email, rather than an email from a particular individual. Id. Second, it informs the recipient of
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the general subject of the message. Id. Third, it accurately identifies Virtumundo's business line that initiated the message. Id. It is not "advertising copy" as Plaintiffs contend. Id. . Virtumundo identifies itself in the "from" line by using its domain name, and expressly in the content of the emails it sends, for informational rather than "branding" purposes. Shopmaker Decl. ¶ 12. Virtumundo does not advertise its own services to consumers, and most consumers would not recognize the Virtumundo name. Id. ¶ 13 Similarly, Virtumundo transmits email to persons who generally do not have any personal relationship with any Virtumundo employee. As such, including in the "from name" field the name of Virtumundo or its employee who initiates the transmission would not provide meaningful information. Id. ¶ 14. To the contrary, to do so would obscure the fact that the email contains a commercial solicitation. A "from name" of "William A. Worker" (a hypothetical Virtumundo employee, for example) may lead a consumer to believe the message is from an individual and is personal in nature, rather than from a company. Id. The "from name" of CriminalJustice, on the other hand, clearly implies a commercial solicitation. "Virtumundo" or "William A. Worker" would be ambiguous. Id. Plaintiffs admitted that they "were not `adversely affected' (as that term is used in 15 USC 7706(g)(1)) by the [emails they allege Defendants sent]." 3 See Declaration of Derek A. Newman in Support of Opposition to Plaintiffs' Motion for Partial Summary Judgment ("Newman Decl.") ¶ 6, Ex. C at 2:3 (No. 7). Rather, "Omni is only seeking statutory damages in this action." Id. B. Relevant Procedural and Discovery History Plaintiffs are in the business of filing lawsuits under CAN-SPAM and CEMA. (Newman Decl. ¶ 2). Plaintiffs commenced this action on February 9, 2006, alleging, inter alia, receipt of 6000 unsolicited emails. (Dkt. No. 1). Plaintiff filed a first amended Plaintiffs made this surprising admission in "Plaintiff Omni's Answers and Responses to Defendant Virtumundo's First Requests for Admission to Omni" in response to Request for Admission No. 7.
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complaint on April 4, 2006 (Dkt. No. 15). On November 2, 2006, Defendants filed a Motion for an Undertaking Pursuant to 15 U.S.C. § 7706(g)(4), with a noting date of November 17, 2006 (Dkt. No. 38). On November 3, 2006, Plaintiffs filed a Motion for Relief, seeking to be excused from responding to the Motion for an Undertaking on the ground that they planned to file a summary judgment motion that would "result in the resolution of the ultimate issues in this case" (Relief Motion 2:11-12)) (Dkt. No. 42). The Court granted Plaintiffs' Motion for Relief. (Dkt. No. 46). On December 18, 2006, Plaintiffs filed the Motion now before the Court. (Dkt. No. 53). Pursuant to FED. R. CIV. P. 16(f), the last court day to complete discovery and file and serve motions to compel discovery was December 15, 2006. By stipulation of the parties, the Court extended the deadline for the parties to depose fact witnesses to January 15, 2007, and extended the deadline for filing general dispositive motions to January 22, 2007 (Dkt. No. 50). The depositions of plaintiffs James S. Gordon and Omni Innovations, LLC are scheduled for January 10 and 11, 2006. (Newman Decl., ¶ 3). Counsel for Defendants asked Plaintiffs' counsel to stipulate to move the Motion back a week, to permit Plaintiffs' depositions to be taken before Defendants' Opposition to the Motion was due. Plaintiffs refused. (Newman Decl., ¶ 4). Accordingly, Defendants' Opposition is being filed before Plaintiffs' depositions have been taken. Id. III. ARGUMENT A. Summary judgment should be denied because there are disputed issues of material fact. Summary judgment is appropriate only upon a showing that there is "no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law." FED. R. CIV. P. 56(c); Celotex Corp. v. Catrett, 477 U.S. 317, 323-24, 91 L. Ed. 2d 265, 106 S. Ct. 2548 (1986) ("One of the principal purposes of the summary judgment rule is to isolate and dispose of factually unsupported claims or defenses . . . ."). A fact is
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"material" if its resolution will affect the outcome of the lawsuit. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 91 L. Ed. 2d 202, 106 S. Ct. 2505 (1986). A dispute about a material fact is "genuine" if "the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Id. The moving party bears the burden of informing the court of the basis for its motion, together with evidence demonstrating the absence of any genuine issue of material fact. Celotex Corp. v. Catrett, supra, 477 U.S. at 323. Once the moving party has met its burden, the party opposing the motion may not rest upon the mere allegations or denials of his pleadings but must set forth specific facts showing that there is a genuine issue for trial. Anderson v. Liberty Lobby, Inc., supra, 477 U.S. at 248. Although the parties may submit evidence in an inadmissible form--namely, depositions, admissions, interrogatory answers, and affidavits--only evidence which might be admissible at trial may be considered by a trial court in ruling on a motion for summary judgment. FED. R. CIV. P. 56(c) ; Hal Roach Studios, Inc. v. Richard Feiner & Co., Inc., 896 F.2d 1542, 1550-51 (9th Cir. 1990); Beyene v. Coleman Security Services, Inc., 854 F.2d 1179, 1181 (9th Cir. 1988); see United States v. Dibble, 429 F.2d 598, 603 (9th Cir.1970) (court may disregard inadmissible evidence sua sponte). Plaintiffs Motion falls far short of meeting the initial burden of demonstrating the absence of any genuine issue of material fact. Instead, Plaintiffs repeatedly mischaracterize Defendants' position as consistent with their own (see, e.g., Motion 2:2 ("[t]he Material facts of this matter are uncontested"); id. at 5:8 ("there are no material facts in dispute"); id at 6:15-16 ("the fact that the Defendant Virtumundo here failed to identify itself on the `From' line, but instead falsely displayed its advertising copy, is indisputable"). In truth, Defendants dispute most of Plaintiffs' factual contentions. Plaintiffs' rhetoric cannot remedy the paucity of their evidence, the vast majority of which is inadmissible (and to which Defendants object and move to strike, as described below). Finally, Plaintiffs and Defendants have radically different views regarding the inferences that can properly be drawn from those facts that are uncontested, again
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suggesting that summary judgment is inappropriate in the instant action. B. Plaintiffs lack standing to assert claims under CAN-SPAM because they are not a bona fide Internet access service provider adversely affected. CAN-SPAM (15 U.S.C. §§ 7701, et seq., the "Act") provides that only certain federal agencies, state attorneys general, and "a provider of Internet access service adversely affected by a violation" have standing to bring a claim under the statute. 15 U.S.C. § 7706(g)(1). CAN-SPAM does not provide a private right of action to consumers. 15 U.S.C. § 7706(a). Consequently, the first material issue in dispute is whether Plaintiffs (i) are an Internet access service provider and (ii) have been adversely affected by a violation of the statute. 1. Plaintiffs are not a bona fide Internet access service provider.

As described in Defendants' pending Motion for an Undertaking, Plaintiffs have no standing unless they prove they are "bona fide Internet service provider(s)" providing "actual Internet access service to customers." 150 CONG. REC. E72 (attached as Exhibit M to Townsend Decl. in support of Motion for an Undertaking (Dkt. No. 41)). "The term `Internet access service' has the meaning given that term in section 231(e)(4) of the Communications Act of 1934 (47 U.S.C. 231(e)(4))". 15 U.S.C. § 7702 (11). The term "Internet access service" means a service that enables users to access content, information, electronic mail, or other services offered over the Internet, and may also include access to proprietary content, information, and other services as part of a package of services offered to consumers. Such term does not include telecommunications services. 47 U.S.C. § 231(e)(4). Plaintiffs contend they are an Internet access service provider because they operate a web site and have provided email accounts to nine people since May 2005. (Omni Response to Interrogatory No. 22, Attached as Exhibit U to Townsend Decl.) These accounts were provided for free "subject to data collection" by Plaintiff Gordon. Id. Merely providing email accounts to a handful of friends and family at no charge does not render Plaintiffs a bona fide Internet access service provider. If it did, every one of AOL's more than 20 million subscribers (who can assign screen names and associated
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email accounts to household members) would qualify. Such a construction is plainly absurd. Plaintiffs do not provide "Internet access service" for the purposes of the Act because "consumers" in the context of the Act implies a commercial relationship. 4 CANSPAM's standing requirement is intended to provide a private right of action for legitimate Internet access service businesses, such as AOL itself. The statute does not confer that right on an Internet access service customer, notwithstanding that such customer may in turn provide free email accounts to its friends or family. See REPORT OF THE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION ON S. 877, S. REP. No. 102, 108th Cong., 1st Sess. 2-3 (2003) (the "Committee Report") (Exhibit N to Townsend Decl. in Support of Defendants' Motion for an Undertaking) (Dkt. No. 41-14) (referencing global Internet access providers such as Microsoft, Earthlink, AOL, etc.). Since Plaintiffs do not have customers, they are not a "bona fide Internet service provider" as contemplated by the Act, and do not satisfy CAN -SPAM's standing requirement. Further support for Defendants' contention that Plaintiffs are not a "bona fide Internet service provider" comes in the Gordon Declaration. There, the plaintiff acknowledges at some unspecified time since 2005 he "took over the administration of those email accounts and began directly receiving the email sent thereto." (Gordon Decl. ¶ 9). Gordon thus admits that even the non-paying "customers" upon whom he founded his claim to be a provider of Internet access service no longer receive email sent to their

This implication is supported by the fact that in presenting the bill eventually codified as CAN-SPAM to the House of Representatives, Hon. John D. Dingell stressed that "we intend that Internet access service providers provide actual Internet access service to customers. 150 CONG. REC. E72, supra (Exhibit "M" to Townsend Decl.) (emphasis added). "Customers" clearly suggests a commercial transaction. See, e.g., Dictionary.com Unabridged (v 1.1). Random House, Inc. http://dictionary.reference.com/browse/customer (accessed: January 03, 2007) ("Customer: 1. a person who purchases goods or services from another; buyer; patron.")
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(former) accounts. Plaintiffs have not met their burden of establishing that they are providers of Internet access service, and the Motion on the CAN-SPAM claims should be denied without further consideration. 2. Plaintiffs were not adversely affected by a violation of the statute.

The Committee Report submitted in connection with S. 877 (the bill ultimately codified as CAN-SPAM) described in some detail the adverse economic impact of unsolicited commercial email on Internet service providers: Massive volumes of spam can clog a computer network, slowing Internet service for those who share that network. ISPs must respond to rising volumes of spam by investing in new equipment to increase capacity and customer service personnel to deal with increased subscriber complaints. ISPs also face high costs maintaining e-mail filtering systems and other anti-spam technology on their networks to reduce the deluge of spam. Increasingly, ISPs are also undertaking extensive investigative and legal efforts to track down and prosecute those who send the most spam, in some cases spending over a million dollars to find and sue a single, heavy-volume spammer. S. Rep 108-102, at 6. The experience of Earthlink, as described in Earthlink, Inc. v. Carmack, 2003 U.S. Dist. LEXIS 9963, 12-13 (D. Ga. 2003), is illustrative: In addition to the administrative and out-of-pocket expenses described above, EarthLink suffers other types of more serious and substantial economic loss as the result of spam sent into or out of EarthLink's network. These include the loss of business reputation and the loss of existing and prospective customers that necessarily occurs when an ISP's users are repeatedly spammed and/or when its resources are used to send spam to other users. Earthlink, Inc. v. Carmack, 2003 U.S. Dist. LEXIS 9963, 12-13 (D. Ga. 2003) (Internal quotations and citations omitted). Unlike Earthlink, Plaintiffs did not suffer serious and substantial economic loss, and indeed suffered no economic loss whatsoever. Since Plaintiffs do not operate a business, they could not have suffered loss of business reputation, nor the loss of prospective customers. Likewise, since there were only nine users of Plaintiffs' email server at most, Plaintiffs' resources could not have been used to send spam to other users. The only evidence offered by Plaintiffs that they experienced any adverse impact as a result of Defendants' conduct is a vague, unsupported allegation in the Gordon Declaration that "the volume of spam sent by Defendants . . . has cost me untold hours of
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manpower, and substantial resources." Gordon Decl. ¶ 26. First, this does not suffice to establish that there is no genuine issue as to any material fact. Second, the time and resources expended by Gordon appear to be exclusively directed toward litigation preparation (such as sorting emails by sender and deleting duplicates), and not related to combating or managing spam per se. See, e.g., Gordon Declaration in Reponse and Opposition to Defendants' Motion to Compel Segregation of Emails, ¶ 3 ("The job of collecting, sorting, and compiling records on this and other defendants is a very timeconsuming process"). Mr. Gordon's time, it should be stressed, is invested in collecting, reviewing, sorting, and compiling records on emails that have already been identified as spam. See id. ("my clients send me emails that are unsorted in lots of 10-50,000 at one time"). Nowhere, in contrast, do Plaintiffs allege that they had to increase server capacity, hire customer service representatives, or spend money to implement spam filters. Plaintiffs do not claim, and certainly do not present any evidence, that they lost money, experienced system downtime, or that any business was otherwise adversely affected as a result of receiving Defendants' alleged email messages. The time invested by Plaintiffs in intentionally gathering alleged spam emails from their clients in preparation for litigation is obviously not the sort of adverse impact that Congress had in mind when drafting CAN-SPAM. If Plaintiffs had left the messages in the junk mail folders, then they would not have seen the messages and likely would not have known the messages were sent. Plaintiffs were not adversely affected by the violations they allege, and therefore do not having standing the bring the claims alleged herein. Indeed, Plaintiffs admit in their responses to requests for admission that they were not adversely affected by Defendants' alleged emails. See Newman Decl. ¶ 6, Ex. C at 2:7-8. The Motion on the CAN-SPAM claims should be denied on that basis alone. Moreover, even if Plaintiffs experienced some adverse effect, (which they did not, and failed to offer any evidence to demonstrate otherwise), Plaintiffs themselves, rather
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than Defendants, were the proximate cause of those effects. Plaintiffs admit they signed up to receive the emails upon which they base their claims. See Gordon Decl. ¶ 11; Declaration of Michael Shopmaker in Support of Defendants' Motion for an Undertaking ¶ ¶ 20-22 (users of the email addresses at [e-mail], [e-mail], [e-mail], [e-mail], [e-mail], [e-mail], [e-mail], and [e-mail] all affirmatively consented to receive emails from Virtumundo or one of its registration partners). Plaintiffs do not allege that they ever sought to unsubscribe from Virtumundo "using a mechanism provided pursuant to [the statute] not to receive some or any commercial electronic mail messages from" Defendants. See 15 U.S.C. § 7704(a)(4)(A). Given that Plaintiffs opted-in to Defendants' mailings, and never opted-out through the means provided, they (and not Defendants) are liable for any adverse effects they may have suffered. C. Defendants qualify for the safe harbor because the alleged "from" lines identify the sender of the message. The "from name" entries that Plaintiffs allege Defendants used are neither false nor misleading, but accurate and significantly more useful to the recipient than the names Plaintiffs suggest. Defendants are alleged to have used domain names that are registered to them, together with text that identifies the subject of the email. With this information, recipients can identify the name, address, and phone number of the sender, and from the "from" line alone know the email is commercial in nature. Plaintiffs propose a per se rule that Congress did not provide where the full legal name of the individual who sends an email would have to be included in the "from" line. Plaintiffs' argument fails on several levels. 15 U.S.C. § 7704(A)1(b) provides that "a `from' line (the line identifying or purporting to identify a person initiating the message) that accurately identifies any person who initiated the message shall not be considered materially false or materially misleading". This "safe harbor" does not require that such identification be in any particular field in the "from" line, only that the "from" line as a
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whole accurately identify the sender. To determine whether Defendants fall within this safe harbor, the court must identify what it means for a person to be "accurately identified" in a "from line." An email address must be unique in order to function, while the names of entities and natural persons can be shared by literally millions of people around the globe. Consequently, an email address is far more useful than a person's name, provided the email address is at a domain name registered to the person initiating transmission of the email. Congress passed CAN-SPAM to combat commercial marketers that hide their identities. By using a domain name registered to it, a sender allows the recipient to obtain the sender's address and phone number from the publically available WHOIS database. A "from" line that contains the sender's actual email address "accurately identifies" the person who initiated the message for the purpose of 15 U.S.C. § 7704(A)1(b). In this case, Virtumundo is alleged to have sent messages from its own domain names, which are noted in each "from" line and which route to them. Defendants use email addresses in the from line which routes to them. The domain names associated with the email addresses are listed in the WHOIS database. The WHOIS database returns accurate contact information for Defendants in response to each query of Defendants' domain names. Defendants accurately identify themselves in the "from" lines of their emails. As a result, those "from" lines cannot possibly be considered materially false or materially misleading. Defendants therefore qualify for the safe harbor which provides "a `from' line . . . that accurately identifies any person who initiated the message shall not be considered materially false or materially misleading". A contrary conclusion would elevate form over substance and run counter to the concerns underlying CAN-SPAM. For example, "John Smith" would be acceptable under Plaintiffs' construction, even if his email address were [e-mail] (which would require the recipient to subpoena Yahoo to learn John Smith's address and phone number). Conversely, the safe harbor would not apply to a sender who uses its accurate
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domain name in its email address (e.g., [e-mail]), is listed in the WHOIS database, and clearly identifies itself in the message. Pursuant to the policy underlying the CAN-SPAM requirement, namely disclosure of the sender, Defendant qualifies for the safe harbor. The plain language of the statute compels this interpretation. It is also consistent with Congressional intent in the definition of the term "materially": the term "materially", when used with respect to false or misleading header information, includes the alteration or concealment of header information in a manner that would impair the ability of an Internet access service processing the message . . . or a law enforcement agency to identify, locate, or respond to a person who initiated the electronic mail message or to investigate the alleged violation, or the ability of a recipient of the message to respond to a person who initiated the electronic message. 15 U.S.C. 7704(a)(6). The "from name" fields in Defendants' emails in no way impair the ability of a recipient (or anyone else) to locate them. In most cases with commercial email, the "from name" field does not provide useful information because the sender is unknown to the recipient. For example, a "from name" field of "William A. Worker" would provide no real information to a consumer. On the other hand, the "from name" of "Criminal Justice" (accompanied by Virtumundo's domain name) in connection with a message advertising jobs in criminal justice puts the recipient on notice of the nature of the message. Further, CAN-SPAM's prohibition against materially false and materially misleading header information is not specific as to information contained in the "from" line, but applies to header information as a whole. The term `header information' means the source, destination, and routing information attached to an electronic mail message, including the originating domain name and originating electronic mail address, and any other information that appears in the line identifying, or purporting to identify, a person initiating the message. 15 U.S.C. § 7702 (8). Plaintiffs' contention that the "from name" field must be analyzed independently, outside the context of the entire email header, is inconsistent with the Act. In fact, the term "from name" is not contained within the text of CAN-SPAM. The issue the court must decide is whether the header information, as a whole, is materially false
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and misleading. Defendants' header information, which informs a recipient of the general subject of the email and permits Defendants to be easily located, is neither false nor misleading. D. CAN-SPAM does not require the "from name" to consist of a sender's "actual" name. Plaintiffs place great emphasis on a rhetorical effort to establish that Congress intended CAN-SPAM to require the use of a sender's "actual" name in the "from name" field. Even a cursory review of the statute reveals that Plaintiffs' argument fails because Congressional intent is clear. "One determines what Congress would have done by examining what it did." See Legal Services Corporation v. Velazquez, 531 U.S. 533, 560 (2001) (Scalia, J., dissenting). CAN-SPAM contains no requirement that the actual name of a person be contained in the "from name" portion of the from line, and no such requirement is found in the legislative history of the Act. In truth, there is no requirement in CAN-SPAM that the "from name" (as opposed to the "from line") field contain any information at all; a sender is free to simply leave it blank. Any descriptive information in the "from name" field exceeds the CAN-SPAM requirement. Interpreting a federal statute requires two steps. First, the court must determine whether Congress has directly spoken to the precise question at issue. New Edge Network, Inc. v. FCC, 461 F.3d 1105, 1111 (9th Cir. 2006). If the intent of Congress is clear, the inquiry ends; the court "must give effect to the unambiguously expressed intent of Congress." Id. (citations omitted) Second, "if the statute is silent or ambiguous with respect to the specific issue, the question for the court is whether the [plaintiff's position] is based on a permissible construction of the statute." Id. 1. Congress clearly did not intend to require a "from name".

Plaintiffs assert "the accurate identification of the actual sender of a commercial electronic email message in the `header' portion of that email is both required under, and central to, Congress's scheme to regulate commercial email." (Motion at 5:20-23)
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(emphasis added). This is not, however, what CAN-SPAM provides. The relevant portion of the Act, Section 7704, provides in pertinent part, It is unlawful for any person to initiate the transmission, to a protected computer, of a commercial electronic mail message . . . that contains, or is accompanied by, header information that is materially false or materially misleading. For purposes of this paragraph . . . (B) a "from" line (the line identifying or purporting to identify a person initiating the message) that accurately identifies any person who initiated the message shall not be considered materially false or materially misleading 15 U.S.C. § 7704 (a) (1). In the Act, Congress addressed the precise question at issue. It declined to require the actual name of the sender in the "from name" field of the header. There is nothing ambiguous in CAN-SPAM or its safe harbor for those who accurately identify themselves in the "from" line. The safe harbor does not require a sender to accurately identify itself in the "from name" field; it provides a safe harbor for those senders who accurately identify themselves in the "from" line. The term "from name" never appears in CANSPAM. Given this unambiguous language, the intent of Congress is clear, and the inquiry into interpretation ends. The construction that Plaintiffs urge contradicts the clear intent of Congress. 2. Plaintiffs' position is not based on a permissible construction of the statute.

Plaintiffs conclude the "from name" field must contain the "actual name" of the sender because of the Section 7704(a)(1)(B) safe harbor. This conclusion is a logical error known as the "vacuous implication" or "denying the antecedent". It takes the form of an assertion that "if a, then b" compels the conclusion "if not a, then not b." Plainly, this is not the case. Congress wrote express language into the Act that identifying a sender in the "from" line means the "from" line is not misleading. This does not mean the converse is true. Congress did not intend to provide that failing to identify oneself in the "from" line is misleading, or it would have so provided. The existence of the safe harbor makes clear that CAN-SPAM does not require a sender's actual name in the "from" line. To conclude
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otherwise would render 15 U.S.C. § 7704(a)(1)(B) superfluous. Also, the Act applies to one who "initiates the transmission" of emails within the scope of the Act. "[M]ore than one person may be considered to have initiated a message." 15 U.S.C. § 7702(9). Since there may be more than one initiator, Plaintiffs' contention leads to the conclusion that to comply a "from name" might have to be an unwieldy list of all senders in the event more than one person initiated a message. This is not a hypothetical issue. Plaintiffs' theories lead to confusion, rather than clarity, as to who precisely should be in Plaintiffs' "from name". Plaintiff itself identifies this issue but offers no solution to it (Motion 3:15). The Federal Trade Commission (the "FTC"), however, which has a primary enforcement role over CAN-SPAM, has proposed a workable solution to this issue. See, 70 Fed. Reg. 25426, 25452 (May 12, 2005) (Proposed Rule) (Proposed § 316.2(m), addressing when more than one person's products or services are advertised or promoted in a single electronic mail message). Plaintiffs' proposed solutions are utterly unworkable from a practical standpoint, and inconsistent with the rule the FTC proposes. Moreover, 15 U.S.C. § 7702 (16)(B) provides that senders and initiators may use the name of a line of business or a division to identify themselves. In this case, Defendants' "from name" entries such as "criminal justice" are not "advertising copy," as Plaintiffs repeatedly contend, but rather represent Defendants' business lines. See Shopmaker Decl. ¶ 11. Congress spoke expressly when it provided that a header may not be materially false or misleading. The "from" line is but a small portion of the header information. Congress did not provide that the "from" line contain an accurate "from name". Instead, Congress wrote a safe harbor providing that an accurate "from" line would render the header information compliant. By "denying the antecedent" and writing in a requirement that Congress did not, Plaintiffs are improperly construing the statute, and their position must fail. Further, Congress delegated to the FTC the role of developing further rules and guidance for the regulated community. Congress deliberately denied private parties, such
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as the present plaintiffs, a right of action under CAN-SPAM. Consequently, the regulated community is spared litigation costs of the type Plaintiffs presently impose upon these Defendants. E. Plaintiffs' state law claims do not establish any violation of CEMA, and CANSPAM preempts Plaintiffs' CEMA argument. Plaintiffs assert that Defendants' emails violated Washington's Commercial Electronic Mail Act, RCW 19.190 et seq. ("CEMA"). In particular they allege a violation of RCW 19.190.020 which prohibits transmitting a commercial email message that "misrepresents or obscures any information in identifying the point of origin" of the message. Plaintiffs contend that Defendants' failure to include their employees' legal names or their full corporate name in the "from name" field "misrepresents or obscures" information in identifying the point of origin. Plaintiffs' argument must fail given the ease with which Defendants can be located ­ not only by performing a simple WHOIS lookup regarding the domain names from which the emails are sent, but by merely opening the emails themselves. Defendants' names and addresses are clearly set forth in each email they send. To the extent, if any, that CEMA purports to prohibit information in the "from name" field, it prohibits immaterial misrepresentations and falsehoods and is preempted by CAN-SPAM. Congress intended CAN-SPAM to create a single national standard for commercial email, and to that end it preempts state laws, subject to a narrow exception: This chapter supersedes any statute, regulation, or rule of a State or political subdivision of a State that expressly regulates the use of electronic mail to send commercial messages, except to the extent that any such statute, regulation, or rule prohibits falsity or deception in any portion of a commercial electronic mail message or information attached thereto. 15 U.S.C. 7707(b)(1). Further, the following congressional finding is part of CAN-SPAM: Many States have enacted legislation intended to regulate or reduce unsolicited commercial electronic mail, but these statutes impose different standards and requirements. As a result, they do not appear to have been successful in addressing the problems associated with unsolicited commercial electronic mail, in part because, since an electronic mail address does not specify a
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geographic location, it can be extremely difficult for law-abiding businesses to know with which of these disparate statutes they are required to comply. 15 U.S.C. 7701(a)(11). In Omega World Travel, Inc. v. Mummagraphics, Inc., 469 F. 3d 348 (4th Cir. 2006), the Fourth Circuit considered the CAN-SPAM preemption clause in relation to an Oklahoma law that prohibits, among other things, sending a commercial email that "misrepresents any information in identifying the point of origin or the transmission path of the electronic mail message." This is virtually identical to the CEMA provision upon which Plaintiffs rely. The district court ruled that the Oklahoma statute created a cause of action for immaterial errors, and was preempted. The Fourth Circuit affirmed, reasoning "[r]ather than banning all commercial e-mails or imposing strict liability for insignificant inaccuracies, Congress targeted only e-mails containing something more than an isolated error." Omega World Travel, Inc. v. Mummagraphics, Inc., supra, 469 F.3d at 348. The court thus held that permitting claims under state law for immaterial errors would subvert Congress' intent to create a national standard: In sum, Congress' enactment governing commercial e-mails reflects a calculus that a national strict liability standard for errors would impede "unique opportunities for the development and growth of frictionless commerce," while more narrowly tailored causes of action could effectively respond to the obstacles to "convenience and efficiency" that unsolicited messages present. Id. Like the Oklahoma statute, CEMA is preempted to the extent it purports to impose liability for minor errors that do not impede the ability of a recipient to locate the sender. Defendants' alleged "from" lines are not false or misleading, but even if they were, the errors would be immaterial given the ease with which Defendants can be located from the email address or the content of the email in any given instance. Messages do not violate the statute's accuracy requirements when the messages provide numerous methods to identify, locate, and respond to the senders. Omega World Travel, supra, 469 F. 3d 348. Even if CEMA were not preempted by CAN-SPAM, Plaintiffs fail to meet their burden as to their CEMA claims. Plaintiffs provide no analysis or reference to relevant judicial authority supporting their interpretation of the state statute. In the only decisions
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regarding CEMA, Washington courts held that subject lines transmitted with commercial email were deceptive when a recipient was forced to open the message to identify unwanted commercial email. State v. Heckel, 122 Wn. App. 60 (Heckel II) (2004). In that case, the Washington Attorney General brought suit against an Oregon resident, Jason Heckel, alleging violations of the CEMA prohibitions involving two subject lines: "Did I get the right e-mail address?" and "For your review - HANDS OFF!" Id. at 71. The Heckel II court held that those subject lines when transmitted with unsolicited commercial email were deceptive because they were designed to entice the recipient to open the message based on the mistaken belief that the message might be from a friend or acquaintance, or business contact. Id. at 71. Similarly, in an earlier decision in that case, the Washington Supreme Court characterized the sending of commercial email with deceptive subject lines as shifting costs to consumers by making it "virtually impossible to distinguish spam from legitimate personal or business messages." State v. Heckel, 143 Wn.2d 824, 835 (Heckel I), cert. denied, 534 U.S. 997 (2001). By this standard, Defendants' "from" lines are not deceptive or misleading. Rather, Defendants' "from" lines clearly inform recipients that the messages are commercial solicitations. In some cases, Defendants provide the actual name of the business entity on whose behalf the message is initiated. In other cases, they provide the name of the line of business to which the message pertains. Unlike the Heckel subject lines, no reasonable person would believe that a message from "CriminalJustice" is a personal message. Accordingly, Plaintiffs' CEMA claims fail. Plaintiffs do nothing more than make a general reference to the emails attached to the Gordon Declaration combined with a vague assertion that Defendants' "from" lines violate CEMA. This does not meet Plaintiffs' burden of showing that there is no genuine issue as to any material fact. Plaintiffs' Motion should be denied. F. Plaintiffs fail to establish that Defendants are the initiators of the emails As described in the Motion for an Undertaking, Plaintiffs have filed numerous emails with the Court from <msdsa.com>, <prefersend.com>, or <ew01.com>, which
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purportedly form the basis of their claims. Defendants did not initiate those messages, nor do those messages have any relationship to Defendants. See Declaration of Michael R. Geroe in Support of Motion for an Undertaking at ¶ ¶ 20, 21 (Dkt. No. 39) and Exhibits thereto (Adknowledge did not send or initiate emails from <msdsa.com>, <prefersend.com>, or <ew01.com>); Declaration of Michael Shopmaker in Support of Motion for an Undertaking at ¶ ¶ 23, 24 (Dkt. No. 40) and Exhibits thereto (Virtumundo did not send or initiate emails from <msdsa.com>, <prefersend.com>, or <ew01.com>); Townsend Decl. (Dkt. No. 41) and Exhibits P, Q & R thereto (Defendants are not the registrants of <msdsa.com>, <prefersend.com>, or <ew01.com>). Plaintiffs have failed to establish that Virtumundo sent the 7,890 emails described in their Motion. There is no representation, for example, that all such emails included return addresses at domain names registered to Virtumundo. Simply attaching thousands of emails to a declaration and alleging that they violate CAN-SPAM is wholly insufficient to meet Plaintiffs' burden of establishing that there are no disputed issues of material fact. G. Plaintiffs' purported evidence is inadmissible and should be stricken Although a certain amount of rhetorical hyperbole is expected in our adversarial system, such rhetoric becomes improper when it crosses the line into false statements of fact. Plaintiffs cross that line many times in the Motion, repeatedly asserting, incorrectly, that there are no disputed issues of material fact that would preclude summary judgment. (see, e.g., Motion 2:2 ("[t]he material facts of this matter are uncontested"); id. at 5:8 ("there are no material facts in dispute"). Plaintiffs make little effort to educate Defendants and the Court about those facts, in most cases failing to cite to specific evidence (or any evidence). In other cases, Plaintiffs cite inadmissible hearsay or speculation. Few, if any, of the "relevant facts" identified by Plaintiffs are supported by citations to any evidence that might demonstrate their supposed uncontested status. Rather, Plaintiffs refer generally to Exhibit A of the Declaration of James S. Gordon, Jr. in support of the Motion (the "Gordon Decl."), which consists of thousands of pages of
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printouts of emails allegedly sent by Defendants to Plaintiffs. Plaintiffs make no effort beyond the stack of alleged emails to establish that each (or any) of the 7,890 emails upon which they base their claims was sent by Defendants, was received by Plaintiffs, or fails to identify an actual sender in its "from" line. Plaintiffs are even unclear as to the number of emails underlying their claim. See Gordon Decl.¶ 26. This falls far short of the showing required to warrant summary judgment in Plaintiffs' favor. Defendants therefore object to Plaintiffs' purported evidence, as set forth in Exhibit A attached to this memorandum. Defendants hereby move to strike the Gordon declaration in its entirety, or in the alternative move to strike each piece of evidence identified in the attached Exhibit A. IV. CONCLUSION "The CANSPAM Act addresses `spam' as a serious and pervasive problem, but it does not impose liability at the mere drop of a hat." Omega World Travel, supra, 469 F. 3d 348. Yet, Plaintiffs seek over ten million dollars based upon a hyper-technical argument about an immaterial description in an email "from" line that CAN-SPAM does not forbid. In trying to educate the court about CAN-SPAM, Plaintiffs ignore the point that CAN-SPAM does not prohibit commercial email; it merely regulates it. Congress makes clear in the very first paragraph of CAN-SPAM that the statute was passed in order to facilitate the transmission of commercial email through acceptable means. The Act sets forth the construction and mandate defining those acceptable means, and Defendants comply. Plaintiffs' behavior illustrates they have no interest in actually stopping emails from reaching their inbox, but rather they seek to use CAN-SPAM and CEMA to extract settlement payments from law abiding commercial email businesses such as Defendants. Plaintiffs fail to establish that there are no disputed issues of material fact and that they are entitled to judgment as a matter of law. Plaintiffs' Motion consists almost entirely of rhetoric rather than legal argument. Plaintiffs do not identify the elements of the causes of action for which they seek to recover, do not identify undisputed evidence
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that establishes each such element, do not authenticate the emails for which they seek to recover, and do not establish that each of those emails contains materially false or materially misleading header information. To the extent that Plaintiffs' motion is considered for summary adjudication of a single novel legal theory ­ whether CANSPAM requires an actual name in the "from name" field - Plaintiffs urge an expansive interpretation of CAN-SPAM that is inconsistent with the policy concerns underlying the Act. Plaintiffs' position is unsupported by the plain language of the Act and is in any case inapplicable to Plaintiffs' emails, which accurately identify the sender. Plaintiffs fail to meet their burden and, accordingly, Defendants respectfully request the Court deny the Motion. DATED this 8th day of January, 2007. NEWMAN & NEWMAN, ATTORNEYS AT LAW, LLP

By:

Derek A. Newman, WSBA No. 26967 Roger M. Townsend, WSBA No. 25525 Attorneys for Defendants

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NEWMAN & NEWMAN, ATTORNEYS AT LAW, LLP

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