Calif. Court Slams Spammers

UPDATED: In a move that could drastically reduce the amount of spam in your email inbox, a California Court of Appeal in San Francisco Wednesday ruled that so-called “spammers” must identify their pitches for things like “Herbal Viagra,” and “Reducing Debt,” as advertisements.

A three-judge panel unanimously ruled in favor of a 1998 state law that was written to protect against “unsolicited faxed or emailed documents” after a formal complaint has been filed. The judgment reverses a lower court’s ruling that the law is unconstitutional.

The original case involves Mark Ferguson, a Sonoma County man who sued Friendfinder.com and Conru Interactive in May 2000 after repeated attempts to remove his name from their email ads.

The Court of Appeal judges sided with Ferguson and the 1998 law saying both Palo Alto, Calif.-based companies violated Section 17538.4 of the California Business and Professions Code, which went into effect on Jan. 1, 1999.

The law requires that spammers now identify their emails with the characters ADV (or ADV:ADLT for sexual content) in the subject header.

In his opinion, judge Paul Haerle said “the lower court’s ruling sustaining the demurrer without leave to amend as to Ferguson’s first cause of action for negligence is affirmed. In all other respects, the judgment is reversed and this case is remanded to the trial court for further proceedings consistent with this opinion. ”

Costs on appeal are awarded to Ferguson. Attorneys for Friendfinders.com and Conru Interactive have not said if they plan to seek to appeal the ruling to a higher court.

“We’re happy to see that the law that the California state Assembly went to such lengths to pass is going to be used,” John Mozena, a co-founder of the Coalition Against Unsolicited Commercial Email told the San Francisco Chronicle.

The ruling also enforces an “opt out” feature to be included in the emails. Marketers are now required to include a return email address or toll-free phone number for people who want to be removed from the emailer’s list.

Currently, 18 other states hold similar laws. Congress has been mulling over a similar nationwide anti-spam law since 1994.

Cost vs. Convenience

In recent years, the use of email has exploded. By some estimates, there are now 25 million email users sending 15 billion messages per year.

In addition to wasting people’s time with unwanted email, spam also eats up a lot of network bandwidth. Consequently, there are many organizations, as well as individuals, who have taken it upon themselves to fight spam with a variety of techniques. Some private online services, such as America Online , have strict policies to prevent spammers from spamming their subscribers.

But, from the ISP level, stopping spam is not always cost-efficient. suespammers.org founder Tom Geller estimates from his research that ISPs spend 10 to 20 percent of their operating costs dealing with spam on their servers. The biggest cost for ISP, according to Geller, is acquisitions lost in fees.

“For a million subscribers, an ISP cost of attrition is $7 million,” says Geller.

A two-year old Gartner Group study cited spam-related problems as the 4th most likely cause for consumers to leave a service provider.

Editor’s note: A previous version of this story incorrectly identified Friendfinder.com as Friendfinders.com.