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AOL victorious in porn-spam case

The legal victory means monetary damages for the Internet giant and an injunction blocking a Florida company from e-mailing AOL members. AOL also says more lawsuits may be ahead.

Internet giant America Online has secured an injunction and a "significant" monetary settlement, concluding a civil lawsuit it brought against a company it accused of sending unsolicited pornographic e-mail to AOL members.

The settlement requires Fort Lauderdale, Fla.-based Netvision Audiotext to pay AOL an undisclosed amount in monetary damages. The accompanying injunction requires the company to stop sending unsolicited e-mail, or "spam," to AOL members through Netvision's Webmaster affiliates, and to provide detailed information to AOL during future spam investigations.

"This puts adult Web sites on notice that to avoid liability of being sued, they have to start imposing controls on their Webmasters and making sure that people who spam are terminated from their affiliated programs," AOL spokesman Nicholas Graham said.

The settlement and accompanying injunction concluded a January 2001 lawsuit filed by Dulles, Va.-based AOL against Netvision. The lawsuit alleged that Netvision violated the Virginia Computer Crimes Act and the Federal Computer Fraud and Abuse Act, among other statutes.

Netvision, which owns Cyber Entertainment Network, the site accused of spamming, has claimed that its service has a "no-spam" policy. However, AOL's lawsuit alleged that CEN offered incentives for third-party Webmasters to transmit spam, targeting AOL members in particular.

The settlement forces Netvision sites to discontinue soliciting affiliate Webmasters to send spam on its behalf. It also forces Netvision to police itself. Netvision will need to revise its Web site policy to include provisions to crack down on third-party Webmasters who send spam.

"The matter has been settled," John Pasierb, an attorney who represented Netvision, said Wednesday.

Jason Catlett, president of anti-spam organization Junkbusters, praised the victory, but warned of the tough road still ahead.

"They're blocking some major sources of spam to their members, which is laudable," he said. "Unfortunately, most spammers are not large, slow-moving targets that can be efficiently litigated."

The settlement concludes one of many battles continually being fought between Internet service providers, Web sites, online marketers and, ultimately, consumers. Spam continues to be one of the most reviled byproducts of the Internet, clogging e-mail accounts and causing expensive headaches among companies trying to control the tide.

At the same time, service providers and Web sites have treaded a fragile line in their own use of bulk e-mails for direct-marketing purposes. Often, the only difference between spam and company-sanctioned bulk e-mail is that spammers do not have a business relationship with the company.

Last week, Web portal Yahoo required its registered members to update their marketing preferences page. The new format will by default send Yahoo-related e-mail promotions to them unless they choose "No" for a dozen or so categories. Many Yahoo users fumed over the switch, accusing the company of spamming them.

Yahoo maintained that it informed people of the switch and has given people over two months to change their settings before the new ones take effect.

AOL came under fire for similar practices in 1999 when it updated its own marketing preferences section. The update sent company-sanctioned e-mail pitches to members by default.

Nevertheless, the online giant has litigated against alleged spammers since the mid-1990s. This time around, AOL believes the judgment will set a precedent for other companies to pursue spamming businesses in court. AOL's Graham said the settlement may not be the last attempt by the company to sue spammers.

"The possibility exists in the future that we'll pursue this illegal activity on behalf of our members," he said.

News.com's Stefanie Olsen contributed to this report.