Spam king loses MySpace beef

By Matthew Hines  |  Posted 2008-06-17 Print this article Print

The price of spam just went through the roof.

No, the spiraling cost of oil isn't weighing heavily on the international trade of faux ham.

Rather, Media Breakaway and its notorious CEO Scott "The spam king" Richter has been ordered to pay a $6 million arbitration settlement to social networking giant MySpace for using the company's network to distribute millions of unwanted e-mail messages to its users.

Settled in the Central District Court of California, the ruling marks only the most recent legal action aimed at punishing serial spammers for clogging corporate networks and raining loads of unprovoked marketing into end users' in-boxes.

Just over one month ago, MySpace won an even more impressive $230 million settlement from another pair of well-known email assailants, Stanford Wallace and Walter Rines. It looks as if the legal tide is finally turning in terms of making some of the proprietors of these annoying, costly online business models accountable for their actions.

MySpace CSO Hemanshu Nigam said the arbitration win validates the company's continued efforts to stop its network and end users from absorbing unprovoked abuse.

"This award reflects MySpace's continued momentum and holistic approach to ridding the site of spammers and phishers through technological innovation, education, partnerships and enforcement," Nigam said in a statement. "We will continue to do our part in cleansing the Internet of this invasive onslaught of spam."

In the end MySpace was awarded some $4.8 million in damages and repaid for $1.2 million in related legal fees by Calif. district Court Judge George H. King (aka not the guy in the courtroom known as "Spam King").

The ruling specifically referenced Media Breakaway's violation of MySpace user rules forbidding commercial use by its members. It also highlighted the use of affiliate networks to distribute spam, re-affirming other recent rulings that have held companies like Media Breakaway responsible for the actions of their business partners.

While Richter has gone to noticeable lengths to change the way his business operates, it was clearly in violation of the law in its MySpace spam campaigns, affiliates or no, King said in his ruling.

MySpace initially brought its suit in Jan. 2007, claiming that Richter's company violated multiple state and U.S. antispam laws, including California statutes and the federal Can-Spam Act.

The company claimed that Richter initially gained control of MySpace user accounts via phishing schemes and took over accounts that had already been subverted by the attacks to distribute e-mails to users that looked as if they came from other site members.

Richter was previously ordered to pay $7 million to Microsoft as part of a 2003 spam suit brought by the software giant.

Some onlookers have observed that knocking off the big name American spammers won't have a significant impact on the overall volume of spam since so much of it is generated outside of U.S. borders, however, security researchers have tracked the U.S. as one of the leading sources of spam worldwide in the past so, at worst it's a start, right?

Let's hope so.

Matt Hines has been following the IT industry for over a decade as a reporter and blogger, and has been specifically focused on the security space since 2003, including a previous stint writing for eWeek and contributing to the Security Watch blog. Hines is currently employed as marketing communications manager at Core Security Technologies, a Boston-based maker of security testing software. The views expressed herein do not necessarily represent the views of Core Security, and neither the company, nor its products and services will be actively discussed in the blog. Please send news, research or tips to |

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