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Appeals Court Tosses $11M Spamhaus Judgement

Posted by kdawson on Wed Sep 05, 2007 10:51 AM
from the still-say-you're-a-spammer dept.
Panaqqa writes "In a not unexpected move, the US 7th Circuit Court of Appeals threw out the $11 million awarded to e360 Insight and vacated a permanent injunction against Spamhaus requiring them to stop listing e360 Insight as a spammer. However, the ruling (PDF) does not set aside the default judgement, meaning that Spamhaus has still lost its opportunity to argue the case. The original judge could still impose a monetary judgement, after taking evidence from the spammer as to how much Spamhaus's block had cost them. This is unfortunate considering the legal leverage the recent ruling concerning spyware might have provided for Spamhaus."
+ -
story

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[+] Spamhaus to Ignore $11.7M Judgement 471 comments
6031769 writes, "As reported on CNet, Spamhaus is choosing to ignore a judgement of $11.7M against them in an uncontested trial in an Illinois court. According to Spamhaus, the judgement has no impact on them, since they are a British organization." From the Spamhaus reply to the judgment: "Default judgments obtained in US county, state or federal courts have no validity in the UK and can not be enforced under the British legal system... As spamming is illegal in the UK, an Illinois court ordering a British organization to stop blocking incoming Illinois spam in Britain goes contrary to UK law which orders all spammers to cease sending spam in the first place."
[+] News: Kaspersky Wins Important Ruling for the Anti-Malware Industry 96 comments
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[+] Judge In e360 Vs. Comcast Rules e360 a Spammer 156 comments
Brielle Bruns writes "Yesterday, Judge James B. Zagel dismissed claims against Comcast by e360. In the decision, the judge says: 'Plaintiff e360Insight, LLC is a marketer. It refers to itself as an Internet marketing company. Some, perhaps even a majority of people in this country, would call it a spammer.' This clears the path for Comcast's counter-suit." e360 is the spammer that got a default judgement against Spamhaus, as we have discussed on numerous occasions.
[+] Idle: Secretarial Mistake Costs Pepsi $1.26 Billion 2 comments
9gezegen writes "Pepsi learned that if it wants to continue to 'Refresh Everything,' it needs an extra $1.26 billion. It looks like one of the secretaries forget to inform company lawyers about a trade secrets case in a Wisconsin state court. When nobody arrived to court, the judge gave $1.26 billion default judgement. According to Pepsi lawyers, they were not properly served because the secretary was 'so busy preparing for a board meeting.' One might imagine she was working on the refreshments. Perhaps Pepsi should learn more about the Spamhaus case."
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  • Oh yeah? (Score:5, Funny)

    by toleraen (831634) on Wednesday September 05 2007, @10:54AM (#20479571)

    In a not unexpected move...
    Well, then I'm not unglad to hear about this. I still can't not unbelieve that their initial lawyer didn't know how to handle the very basics of the case. I wasn't not hoping to hear that this case would just get thrown out completely...how much can't the US government not do about this though? Inquiring minds don't not want to know...
    • Re:Oh yeah? (Score:5, Funny)

      by GweeDo (127172) on Wednesday September 05 2007, @11:01AM (#20479683) Homepage
      Could you not un-use more double negatives in that one post?
    • Would the term doubleplusexpected be more to your liking?
    • Re:Oh yeah? (Score:4, Insightful)

      by misleb (129952) on Wednesday September 05 2007, @11:21AM (#20479979)
      I think "not unexpected" is valid and meaningful statement. It doesn't quite mean the same as "expected." Though perhaps "unsurprising" would be a better way of expressing the meaning.

      -matthew
    • Re:Oh yeah? (Score:4, Informative)

      by nickname225 (840560) on Wednesday September 05 2007, @11:22AM (#20479999)
      The court would have had a hard time justifying throwing the case out completely. It's probably true that the court initially didn't have jurisdiction, but according to the article, Spamhaus made an initial appearance in the case. Generally, if you make an appearance, you have submitted to the jurisdiction of the court. It's not quite the catch-22 it seems, since you can make an appearance SOLELY for the purpose of challenging jurisdiction without submitting to the jurisdiction of the court. So - basically Spamhaus' attorney messed up and their client has to live with the consequences. Btw - I am an attorney.
      • Re:Oh yeah? (Score:5, Informative)

        by tinkerghost (944862) on Wednesday September 05 2007, @11:46AM (#20480351) Homepage

        It's probably true that the court initially didn't have jurisdiction, but according to the article, Spamhaus made an initial appearance in the case. Generally, if you make an appearance, you have submitted to the jurisdiction of the court.

        FWIR, Spamhause showed up in state court & said, 'you have no jurisdiction, the US court system has no jurisdiction & even if it did, it would have to be a Federal court'. The state judge threw it out properly judging that with no presense or assets in his district, he didn't have jurisdiction. 360 then went to a Federal Judge to redo the case & Spamhause's lawyers in the UK rightly asserted that "fuck the US court system, they have no jurisdiction, don't waste your money." or words to that effect. The problem is that the Federal Judge forgot that US law applies in the US not the world and ruled that being in another country doing things that are perfectly legal & not tortable (is that a word?) in that country is no reason that US law shouldn't be applied to them. In accordance with the new ruling on spyware, 360's case isn't actionable in the US anymore either, but that didn't seem to bother the appeals judge at all in denying the appeal of the ruling.

        • Sort of (Score:5, Informative)

          by www.sorehands.com (142825) on Wednesday September 05 2007, @11:52AM (#20480481) Homepage
          Spamshaus came into Court and filed an answer that in part said, You didn't serve properly and you have no jurisidiction. Then they said, we are not going to play this game, we want to withdraw our answer.

          If you don't answer at all, a default is entered. This is what happened.
  • Next up (Score:5, Funny)

    by UPZ (947916) on Wednesday September 05 2007, @10:56AM (#20479605)
    Anti-virus company gets sued by Win32Trojan maker for 'loss of business'
  • by BubbaFett (47115) on Wednesday September 05 2007, @11:04AM (#20479735)
    Shouldn't I be able to list any domain or IP in any database I please? Isn't it the responsibility of the people using the database to determine whether it's a bad idea? Isn't the real issue between the people blocking email and their customers who are missing email?
    • by fbjon (692006) on Wednesday September 05 2007, @11:16AM (#20479919) Homepage Journal
      Presumably not if you advertise it as being reasonably accurate for some specific purpose.
      • Re: (Score:3, Insightful)

        Right, but isn't it up to the users of Spamhaus to determine the accuracy for their purposes? I'm sure if the *users* of Spamhaus really cared about getting mail from e360 they'd let Spamhaus know about it. Sounds like the only people who care that Spamhaus lists e360 is e360.

        -matthew
            • Re: (Score:3, Insightful)

              A simple background check (which has been done at every job I've ever held) would reveal your list to be shite

              Most places that do background check pay some third party to do it. If that third party relied in whole or in part on the list in question, perhaps to fill gaps in other records, then, no, the background check would not reveal the list would be wrong, it would return the results of relying on the list.

              Now, what would happen in the real world today is that the first person to find out they were flagg

      • by SCHecklerX (229973) <slshdt@freefall.homeip.net> on Wednesday September 05 2007, @11:29AM (#20480111) Homepage
        Why? The receiving end is the one with the power to use or not use your list, or to whitelist certain entities in that list. On my own mail servers, I reject stuff that is on zen. The sender will get that error, and can talk to their own mail admins, who should see *why* they are on the list and work to get themselves removed. If that is impossible, and this is, indeed, a legitimate company trying to contact one of our employees (this has never happened, if they are legit, getting off the list is trivial), then the receiving end is the one who has the power to make the decision whether those messages should come in or not.

        I don't see the problem with keeping a list. If it is a bad list with too many false positives, then nobody would use it. Sheesh.
      • Re: (Score:3, Insightful)

        You can, as long as that database doesn't infringe on the rights of other companies to do their business. If you listed Microsoft, SCO, and Apple all in a database of "douchebag companies", posted that on your site, and then told everyone to block them for being douchebags, I have a feeling you would get sued (and rightfully so).

        Oh please, how many sites out there list "douchebag companies" and tell people not to buy from them? It is called free speech.

        -matthew

      • by Phroggy (441) <slashdot3@phroggyYEATS.com minus poet> on Wednesday September 05 2007, @12:37PM (#20481209) Homepage

        If you listed Microsoft, SCO, and Apple all in a database of "douchebag companies", posted that on your site, and then told everyone to block them for being douchebags, I have a feeling you would get sued (and rightfully so).
        Nope, you're wrong. Since you mentioned Apple...

        Carl Sagan once sued Apple for calling him a "butt-head astronomer." Sagan lost the suit, because according to the judge:

        There can be no question that the use of the figurative term 'Butt-Head' negates the impression that Defendant was seriously implying an assertion of fact. It strains reason to conclude that Defendant was attempting to criticize Plaintiff's reputation or competency as an astronomer. One does not seriously attack the expertise of a scientist using the undefined phrase 'butt-head.'

        I'm sure "douchebag companies" would fall into the same category.

        Spamhaus' Register Of Known Spam Operations (ROKSO) is a list of "known professional spam operations that have been terminated by a minimum of 3 Internet Service Providers for spam offenses." That's a much more serious accusation than "butt-head" or "douchebag." If it's true, of course, then the plaintiffs can burn in hell... but they claim it's not true, and they've been falsely labeled by Spamhaus, which has damaged their reputation and cost them business.
  • by aim2future (773846) on Wednesday September 05 2007, @11:16AM (#20479923) Homepage
    that I get sued by the spammer if I reject their spam
  • Woe be gone (Score:3, Insightful)

    by packetmon (977047) on Wednesday September 05 2007, @11:24AM (#20480019) Homepage
    I wonder how long will it be before some company like these fools [accucast.com] comes along and starts lobbying the powers that be to tweak "CAN-SPAM" like fables. I say get to the hardcore bottom of it all. Oh more Viagra spam eh... Sue the damn pharmaceutical companies for allowing their advertisers to break laws. That will minimize a whole slew of spam. Think about the monies pharmaceutical companies would have to even dish out to hear a case if half the US started filing small claims cases, class action cases, etc.
  • I don't get it (Score:4, Insightful)

    by SCHecklerX (229973) <slshdt@freefall.homeip.net> on Wednesday September 05 2007, @11:24AM (#20480029) Homepage
    Certainly if someone wanted to receive e360's messages, or if they were EXPECTING a message from e360 and didn't get it, they can talk to their own mail admins and have e360 whitelisted. Why is it so hard to effectively explain to the courts that Spamhaus has nothing to do with whether e360's messages get through or not, other than responding to a query from the receiving end asking if Spamhaus believes they are a spammer?

    In reverse, is the do-not-call list something that will be targeted next?
    • Re:I don't get it (Score:5, Informative)

      by DaleGlass (1068434) on Wednesday September 05 2007, @11:33AM (#20480175) Homepage

      Why is it so hard to effectively explain to the courts that Spamhaus has nothing to do with whether e360's messages get through or not, other than responding to a query from the receiving end asking if Spamhaus believes they are a spammer?

      Because Spamhaus didn't show up in court to explain it. From Wikipedia:

      Spamhaus initially succeeded in moving the case from state to federal court, but then stopped defending itself against the lawsuit, because it is based in the United Kingdom and outside the jurisdiction of United States courts. The American court had no choice but to award e360 a default judgment totaling $11,715,000 in damages. Spamhaus subsequently announced that it would ignore the judgment.
  • by Kazoo the Clown (644526) on Wednesday September 05 2007, @11:48AM (#20480403)
    The suit was mistargeted. Spamhaus doesn't force anyone to use it. It is the ISPs that impose it on email accounts, not Spamhaus, and consequently, THEY should be liable if they do not allow their users to disable such blocking. Use of Spamhaus contributes to email unreliability and should not be imposed by ISP services. An email account carries with it some expectation of usability, which IMHO cannot be simply TOS'ed away in the fine print. Email is unreliable enough without blacklist (or for that matter, even greylist) techniques being applied by lazy ISPs who are looking for a brainless way to reduce their email traffic load. Either ISPs are a common carrier or they are not, the imposition of blocking techniques should carry along with it some responsibilities for its failures.
  • by www.sorehands.com (142825) on Wednesday September 05 2007, @12:01PM (#20480665) Homepage
    Though the default judgment still stands, the trial court judge will have to look harder at any injunction and money damages -- not take Linhardt's word for it.

    The reason for this is my case against him, at http://www.barbieslapp.com/spam/e360/timeline.htm [barbieslapp.com] , because in my case, I argued (and lost) personal juridiction of Linhardt, in part because he said (and the court believed it) that he had no business in California. I pointed out in his affadavit in the Spamhaus where he said "e360 and I lost contracts..." and "e60 and I lost business opportunities.." and that of the 7 companies listed, 4 are in California, he explained it away by saying that he really meant that when he said, e360 and I he meant e360 and I in my role as president. If you don't suffer harm personally, you have no standing to bring a lawsuit. I filed a motion for reconsideration, on Linhardt's personal jurisdiction, in part based on this.

    Spamhaus's lawyers are aware of this.

    • Re: (Score:3, Insightful)

      I think corporations that get spammed, including ISP's should be able to go to companys like DoubleClick and e360 and bill them for the aggregiate costs. "You sent 2 million emails through our network last month, here is your bill for 200k for bandwidth + costs for the end users"

      unfortunately that same logic could be applied to other sites that the ISPs want to extort
      "Hello Google, you sent x Gigabytes of data through our network to our customers, here's the bill for the bandwidth used..."

    • Re: (Score:3, Informative)

      I think Spamhaus could have avoided the issues they are dealing with now by not labeling spammers as spammers, and came up with a more politically correct term that is legally bulletproof.

      Spamhaus are not in any trouble because of what name they used, or even what they listed. They're in "trouble" on a technicality, they messed up their claim that this court has no jurisdiction over them (which it doesn't; they are not a US company and have no holdings or business in the US, so a US court can't do a damn th

        • by asuffield (111848) <asuffield@suffields.me.uk> on Wednesday September 05 2007, @05:09PM (#20486045)

          They can be blocked from continuing to do business in that jurisdiction. Not that it is enforceable in this age of the Internet.


          As a donation-funded non-profit organisation based in the UK and Switzerland, they don't do business in the US at present, never have, and are not particularly likely to do so in the future. They don't even have a tax-exempt status in the US. A US court cannot prohibit US citizens from donating to them, nor can they confiscate those donations. There really isn't anything that a US court can do to them.
    • Germany, IIRC, still has food purity laws. You can't sell a product as "beer" unless its only ingredients are water, yeast, hops, malt and barley. Sausages must be 100% meat from a named part of the animal (and the animal should not have been named "Fido").

      Spam, I suspect, would fall under the category of "cheese".