e360 sues a vendor
As if suing themselves out of business by going after Comcast and Spamhaus weren’t enough, e360 is now suing Choicepoint for breach of contract and CAN SPAM violations. As usual, Mickey has all the documents (complaint and answer) up at SpamSuite.
This may actually be an interesting case. On the surface it is a contractual dispute. Choicepoint sold e360 40,000,000 data records containing contact information including email addresses, snail mail addresses and phone numbers. Some of the records were marked “I” meaning they could be used for email. Some of the records were marked “O” meaning they could not be used for email.
Despite these terms being reasonably well defined in the contract, e360 sent email to addresses in records marked “O.” Some of those addresses resulted in e360 being sued by recipients. During the course of the suit, e360 contacted Choicepoint and asked for indemnification. Choicepoint refused for a number of reasons, including the fact that Choicepoint told e360 the addresses were not for mailing. In response, e360 filed suit.
The interesting and relevant part of this case is the CAN SPAM violation that e360 alleges.
9. In her September 10, 2008, letter, Ms. Meredith Sidewater on behalf of ChoicePoint declined to indemnify e360 for the expenses and damages incurred by e360 in the three (3) disputes. See Letter attached hereto as Exhibit B. She claimed four (4) of the six (6) emails at issue in the disputes were “Optin Status of O,” which she contended means that the records were approved only for direct mail and not email.
10. If Ms. Sidewater’s assertion is true, this assertion constitutes an admission of violation of the CAN-SPAM Act of 2003, which provides that if a recipient requests not to receive commercial email, then it is unlawful for the sender to release, sell, or transfer such person’s email address to a third party. Thus, ChoicePoint admits that it breached ¶ 12(a)(ii) of the Agreement. But for this breach, e360 would not have sent any emails to the complainants and would not have been sued.
CAN SPAM does indeed state that once someone has opted out from email that the address cannot be sold, transferred, leased for any purpose. If e360 prevails in this case it will have far reaching implications for a lot of senders and data brokers. I’ll be watching this one closely.