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ELECTRONIC MESSAGING Gordon v Virtumundo Inc. No. 07-35487 D.C. No. CV-06-00204-JCC 6 August 2009 A US court of appeals holds that the federal CAN-SPAM Act preempts state legislation on electronic commercial messages except in the case when state law specifically prohibits fraud in such messages. On 9 August 2009, the US Court of did not qualify for CAN-SPAM’s although providing email accounts Appeals for the Ninth Circuit (‘the narrow private cause of action. The and email access may be sufficient 11 . Court’) issued an opinion in Court found Mr. Gordon to be an This implies that individual Gordon v.Virtumundo, Inc., et al. 1 opportunistic plaintiff based on the consumers - even those managing which limited future causes of manner in which he had email accounts for others - do not action under the federal Controlling orchestrated his suit. Mr. Gordon have standing to sue under CAN- the Assault of Non-Solicited hosted an internet domain and had SPAM 12 . Pornography and Marketing Act 2 created multiple email accounts on The Court likewise found that Mr. (CAN-SPAM) and dismissed claims this domain for family and friends. Gordon did not suffer an adverse based on the Washington state laws, Mr. Gordon proceeded to request effect sufficient to make a private including the Commercial that he receive commercial emails claim under CAN-SPAM. The Electronic Mail Act 3 (CEMA) which from a number of businesses. Some Court determined that Congress was intended to target deceptive such businesses then began to send intended an adverse effect to advertising. Looking beyond the email advertisements, including include more than a mere case’s significance for the litigants, Virtumundo. Refusing to utilize nuisance 13 . The harm must be real the decision may result in fewer spam filters or any other spam- and beyond that typically available forums for anti-spam blocking tools, Mr. Gordon took no experienced by IAS providers, activists and may also present efforts to prevent the commercial including operational and technical obstacles for legitimate claimants emails from clogging the various problems and associated financial seeking relief under CAN-SPAM. email boxes 5 . In fact, Mr. Gordon burdens 14 . Such damage must be Enacted by Congress in 2003, welcomed the spam to build legal caused directly by the presence of CAN-SPAM is intended to protect suits against Virtumundo and other spam. However, the Court noted consumers from deceptive online advertisers 6 . that spam does not generally cause electronic marketing by commercial network crashes and other such Standing threshold advertisers, known as‘spammers’ . disasters 15 . Thus, an IAS provider CAN-SPAM requires spammers to CAN-SPAM provides for a private must suffer seriously debilitating make certain marketing-related cause of action only for plaintiffs network, infrastructure and disclosures, to properly scrub that are providers of internet access bandwidth-related impairments against relevant do-not-contact lists service (IAS) and are adversely directly attributable to the presence and to provide an opt-out affected by a violation of CAN- of unwanted spam to have standing mechanism that allows consumers SPAM 7 . The Court considered under the Act 16 . to elect not to receive future whether Mr. Gordon was a proper The opinion instructs lower court electronic communications. CAN- plaintiff under this criterion. Upon judges to review standing for CAN- SPAM is enforced by state and review of the record and the SPAM claimants with an extremely federal regulators, but also provides relevant case law, the court critical eye, taking note of whether a narrow private cause of action for determined that Mr. Gordon did the plaintiff appears to operate a internet access service providers not qualify as an IAS provider and valid internet service business or if adversely affected by a violation of that he was not‘adversely affected’ the plaintiff has other motives 17 . The the Act. CAN-SPAM allows for by violations of the Act so as to have opinion suggests that serial litigants, injunctive and monetary relief 4 . standing under CAN-SPAM 8 . such as Mr. Gordon, should not be The Court determined that eligible for the vast statutory Case snapshot Congress intended the CAN-SPAM damages contemplated by CAN- In 2006, James S. Gordon, Jr., and private cause of action to be limited SPAM. By largely eliminating such his company, Omni Innovations to bona fide IAS providers, which individuals from the pool of LLC, filed suit against Virtumundo, did not include Mr. Gordon potential plaintiffs, the Court left Inc., an online commercial because he did not operate an CAN-SPAM enforcement to advertising company, alleging authentic internet service 9 . The regulators, states and legitimate violations of CAN-SPAM and Court pointed out that IAS ISPs. CEMA. Mr. Gordon requested providers, such as Verizon, and injunctive relief and claimed social networking sites, such as Federal preemption millions in damages resulting from Facebook, could be legitimate IAS Mr. Gordon made additional state his experiences with spam. providers under certain law claims under CEMA, which The Court dismissed all of Mr. circumstances 10 . Merely providing were dismissed by the Court as Gordon’s claims, holding that he email accounts is not adequate, preempted by CAN-SPAM. The 09 e-commerce law reports volume 09 issue 04