A lawsuit brought by America Online against one of the Internet's biggest porn site operators could have far-reaching implications for the $1 billion online adult industry.
A lawsuit brought by America Online against one of the Internets biggest porn site operators could have far-reaching implications for the $1 billion online adult industry.
The suit, filed Dec. 21 in the U.S. District Court for the Eastern District of Virginia, charges Cyber Entertainment Network (CEN) and scores of affiliated Webmasters with a massive and ongoing unsolicited e-mail campaign aimed at AOLs 27 million members.
"The bottom line is that this is a very clear violation of our anti-spam policy," said AOL spokesman Nicholas Graham. "Theyre either Webmasters that spam or organizations that incentivise the spam process."
CEN officials did not return phone calls seeking comment for this story.
The suit is more than just a basic spam complaint, industry onlookers said. It seeks for the first time to hold an adult site operator liable for the behavior of affiliate Web sites it does not own.
"This is the first and biggest case of its kind," said Tom Hymes, assistant editor at AVN Online, an adult industry news site. "AOL seems to be setting the groundwork for attacking the entire affiliate model structure.
Large adult operators like CEN run affiliate programs for independent Webmasters and pay them for generating traffic. The Webmasters, in turn, populate their own, often free sites with CEN banner ads that click through to the companys many porn properties.
Some of the affiliates also resort to spamming to help pick up traffic. Its this practice that has raised the ire of America Online, since porn spam is epidemic on the network and a constant public relations black eye. Many customers dont understand spammers fake addresses and often the return address on the e-mail is AOL itself.
The suit asks for an immediate injunction and $25,000 in penalties for each day the roughly 30 Webmasters spammed its network. The damages, if granted, would easily reach into the millions.
The suit also attempts to tie CEN to the errant Webmasters through HTML code that is used to credit each affiliate. If successful, the AOL suit could strike at the economic fabric of the adult industry and make big sites take more care in deciding with whom they do business, industry sources said.
"We have the law on our side," Graham said.