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Spam king retreats

Sanford Wallace agrees to pay $2 million in the last lawsuit against his junk email company and leaves spamming behind for now.

One-time spam king Sanford Wallace is being charged $2 million to settle the last outstanding lawsuit against his company, Cyber Promotions, once a junk emailing powerhouse.

Even while the ink is drying on the court settlement with ISP EarthLink, Wallace is returning to his admittedly lower-profile prespam business endeavor: promoting restaurants in Philadelphia.

Cyber Promotions agreed to a judgment to pay the national Net provider $2 million and to refrain from sending junk email to its network, according to both Wallace and EarthLink.

This is the second announced legal settlement this week against the former junk email firm. On Tuesday, free email provider Bigfoot won a judgment against Cyber Promotions for an undisclosed sum.

These were far from the first lawsuits filed and won against Wallace and his spam company, but they might be the last.

"It closes every pending lawsuit against Cyber Promotions," Wallace told CNET's NEWS.COM.

Wallace, once the feisty king of spam, has let his company wither since it lost its Net connection from online backbone AGIS in October. Antispammers have been celebrating ever since.

But the Net's most famous junk emailer said he may be down but he is certainly not out of the game--at least not yet.

For months, he has been working with fellow junk emailer Walt Rines to build a backbone network from which clients could safely send junk email. The company, dubbed Global Technology Marketing Incorporated, has not yet gotten off the ground, despite promises in November that it would be up and running within a few weeks.

"We're still working on the backbone," Wallace said, adding that he couldn't make any promises about when it would go up, if at all.

In the meantime, Wallace is adjusting to a quieter life where threats from antispammers are few and profits from junk email and related products he used to sell are nonexistent.

"Right now I'm promoting restaurants back in my area," he said. "That's my old business, and I'm back. I'm feeling great. It's the first time in three years that I'm...not getting angry home phone calls--just inquisitive ones. It's a very different type of phone call than an angry nerd on the other line."

Wallace, who used to relish all publicity, now makes something of a concession to his enemies--those who want to rid the Net of the exponentially growing flood of junk email. "The Cyber Promotions everyone loved to hate is certainly not going to come back in the same way. If we come back, it's going to be in a more politically correct model," he said.

To all the antispammers cheering his demise, Wallace now says, "You won." But he is quick to add this caveat: "You only won with a Band-Aid. It's going to be a real shame if legitimate companies like McDonald's can't send out a coupon that people want just because a lot of people send out a bunch of garbage."

Critics say Wallace hoisted himself on his own petard by supplying both software and connectivity to spammers and adding to the flood of junk email that pervades the Net.

Wallace said he made attempts to "legitimize" spam in working with AGIS. But in the end, AGIS said Wallace and his company broke the same rules it had established and kicked him off, saying that spammers can't be trusted.

He now bemoans the fact that spam advertising pornography and pyramid schemes has become ubiquitous. Although his critics accused him of sending the same kind of junk email, Wallace said he only promoted legitimate products.

Although Wallace said he never sent out pornography or get-rich-quick spam, he conceded that some of Cyber Promotions' customers did. And for that, he's sorry.

"I apologized on behalf of some of the customers of ours," he said. "I cannot apologize for standing behind something I completely believe in. But I do apologize for some of the actions of my clients.

"If I had to do it all over again, I probably would have done some things differently. We never intended to damage anyone," he added.

Still, Wallace said he doesn't regret leading the battle to try to legitimize spam, even if it meant falling on his own sword in the end. "If it wasn't me who did this, it most certainly would have been someone else," he said.