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Hotmail sues spammers

The free email service takes eight junk emailers to court, claiming they forged the "" domain in return addresses on unsolicited mail.

Free email service Hotmail today became the latest of many to attack unsolicited commercial email, announcing it filed a suit in federal court against eight spammers.

The suit claims that the companies forged Hotmail's "" domain name into the return addresses of unsolicited commercial email messages, falsely identifying Hotmail as the spam's originating service.

"We've had an ongoing problem with companies grossly misrepresenting themselves as Hotmail users and hurting our reputation," Rex Smith, chief operating officer for Hotmail, said today.

Van$ Money Pie; ALS Enterprises; LCGM, Incorporated; Christopher Moss d/b/a Genesis Network; Claremont Holdings Limited; Consumer Connections of Charlotte, North Carolina; Palmer & Associates of San Diego, California; and Financial Research Group of El Cajon, California, are named as defendants in the suit.

In its complaint, filed in United States District Court for the Northern District of California, San Jose Division, Hotmail alleges the spammers' practices damage its reputation and business. The company claims trademark infringement and dilution, unfair competition, and violations of the federal Computer Fraud and Abuse Act, as well as fraud and libel.

Hotmail is seeking "injunctive relief" as well as punitive and compensatory damages, though the amounts have not yet been specified, Jim Brelsford, an attorney with Hosie, Wes, Sacks & Brelsford, who is representing Hotmail, said today. He said Hotmail this week will file for a preliminary injunction to stop the alleged practices. Hotmail announced earlier this month it was being bought by Microsoft. A Hotmail spokeswoman confirmed that deal has closed.

Spam has become one of the most widespread and hated practices on the Net, and everyone from online services to legislators are weighing in on the fight against it to curry favor from the growing population of Netizens. Most recently, two state legislators have introduced bills to either prohibit spam altogether, or to force spammers to provide toll-free telephone numbers and return addresses to recipients so they can request to be removed from junk email lists. (See related story)

America Online has been taking spammers to court for a year, most recently this month. Its suits have been different from Hotmail's, in that AOL is trying to shield its 11 million members from receiving unsolicited email. AOL members are often targets for spam because they tend to be newer to the Internet and therefore less familiar with the practice.

Other companies have run into trouble in a similar fashion to Hotmail, however. Free email service Juno filed a $5 million lawsuit in November, alleging that five spammers forged its domain name as a return address for junk email. That suit is pending.

Along with causing "injury to goodwill and company reputation," Brelsford said, Hotmail's servers were jammed by recipients' angry responses to the spam. This has been a common complaint among email providers that have had their domain names forged.

Attempted legal remedies to spam are not limited to the state level. Currently there are three bills that seek to curb or regulate spam that have been introduced in the House or Senate, all of which are winding their way through various committees.

Also, this week, the second federal trial of a former University of California at Irvine student accused of sending threats via email to Asian classmates will begin. The man's lawyers contend that the email, sent to 59 students in 1996, was a prank. Others say the act is a hate crime. The outcome could start the process of defining email's weight and role as a communications medium. The defendant, Richard Machado, has been charged with ten counts of civil rights violations and could spend up to ten years in prison if convicted. The first trial ended with a deadlocked jury.

Hotmail has been preparing for this suit since before the Microsoft deal was announced, Smith said, adding that Microsoft is "supportive" of Hotmail's effort to fight spam. He said other suits will follow if the practice continues.

"We intend to pursue this kind of activity until we can bring it down to a minimum," Smith said.