Fourth Circuit Confirms Dismissal of Spam Marketing Suit Against Kraft

The Fourth Circuit Court of Appeals has affirmed a lower court’s dismissal of
a case alleging that Kraft spammed an Internet service provider (ISP) with
advertisements for its Gevalia® coffee products. Beyond Systems, Inc. v. Kraft
Foods, Inc., No. 13-2137 (4th Cir., order entered February 4, 2015). Beyond
Systems sued Kraft alleging violations of Maryland’s and California’s anti-spam
statutes, but the circuit court agreed with the district court’s determination
that Beyond Systems “invited its own purported injury and thus could not
recover for it.”

Beyond Systems is a Maryland ISP with servers housed at the residence of
the owner’s parents, and the owner’s brother owns Hypertouch, Inc., a similar
“nominal” ISP with servers in California. Both ISPs host websites with hidden
email addresses that only “spam crawlers” can find, and Beyond Systems uses
the email addresses as “spam traps”; the court notes that “spam-trap-based
litigation has accounted for 90% of Beyond Systems’ income in recent years.”

These spam-trap addresses apparently received hundreds of emails advertising
Kraft’s Gevalia® coffee that allegedly contained false headers in violation
of anti-spam statutes.

The court classified the Maryland and California anti-spam statutes as
tort-based, noting that a tort cannot be committed upon a willing person.
Accordingly, the recipient of a spam message may not seek out the message
then allege a tort for receiving the message. “Beyond Systems increased its
e-mail storage capacity to retain a huge volume of spam, by which it hoped to
increase its eventual recovery under anti-spam statutes,” the court found. “And
it intentionally participated in routing spam e-mail between California and
Maryland to increase its exposure to spam and thereby allow it to sue under
both states’ laws.” Because Beyond Systems consented to receiving the emails,
the circuit court affirmed the district court’s ruling in favor of Kraft.

Issue 555