New York State Attorney General Eliot Spitzer and Microsoft each filed lawsuits Thursday against three e-mail marketing companies for sending a staggering 250 million unsolicited messages a day.
One of the companies is OptinRealBig, run by the outspoken Scott Richter, who defended his techniques to the New York Times and called the accusations baseless. His firm sends out more than 100 million e-mails a day, promoting dating services, stock tips, mortgages and diet pills.
Spitzer said he would seek $20 million in damages from Richter and the other defendants.
"We will drive them into bankruptcy," Spitzer said at a news conference yesterday in New York. "Therefore others will not come into the marketplace because they will see there is no viable business model here."
On Tuesday, President Bush signed a law, effective Jan. 1., that makes it a crime to send deceptive commercial e-mail. But state and federal authorities are already making moves to stem the daily tide of spam. Virginia, which has the toughest anti-spam law in the nation, last week indicted two North Carolina men on felony charges for sending hundreds of thousands of e-mail messages to America Online customers.
New York does not have specific laws against spam, but is instead relying on general business laws to fight bulk e-mailers.
The charges against Richter and others will address the question of whether marketers of products or services can be held responsible for the sales techniques used by independent affiliates. Richter and others have claimed they did not know that their affiliates were using deceptive practices and should not be held liable.
New York State argues that all marketers have a responsibility to control the actions of their agents.
As for Richter, he is not worried about the lawsuits, telling the New York Times that he rejected an offer from the attorney general to settle the case for $100,000. "Messing with us is a big mistake," he said. "The more press I get, even bad press, the bigger we get."