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Pair Ordered to Pay $2-Million Fine for Spam

Ruling is the first under '98 law, but the state may not be able to collect from absent defendants.

October 25, 2003|Jon Healey | Times Staff Writer

A judge on Friday fined a pair of spammers $2 million, the first financial penalties handed down under a 5-year-old state law regulating unsolicited commercial e-mail.

Collecting the money, though, may prove as tough as stemming the e-mails that bombard in-boxes with offers for porn, painkillers and Ponzi schemes.

The targets in the case -- Canyon Country-based PW Marketing Inc. and its owners, Paul Willis and Claudia Griffin -- didn't try to defend themselves, never appearing in court and filing no papers. That enabled California Atty. Gen. Bill Lockyer to win by default earlier this year.

On Friday, Santa Clara County Superior Court Judge William F. Martin imposed the $2-million fine and permanently enjoined the company, Willis and Griffin from sending unsolicited or misleading e-mails.

Shortly after the lawsuit was filed last year, Willis told The Times that he had nothing to fear.

"The worst thing they can do is get a civil judgment against me," he said. "I'm not dumb enough to keep any assets in my name. Neither is Claudia."

Willis, Griffin and PW Marketing could not be reached Friday. "He's gone," said Jack Williams, a former associate of Willis. "He's in Mexico now.... They're out of luck."

Lockyer spokesman Tom Dresslar acknowledged that "we don't know where they're currently residing."

But he added, "We're going to within reason pursue the remedies we have to collect [the $2 million].... We hope to prove that his cockiness is misplaced."

Even if the state comes up empty-handed, the fact that it convinced a court to hold PW Marketing liable for $2 million should deter other spammers, Dresslar said. He added that the judgment "is going to serve as a template" for cases Lockyer's office plans to bring under a more powerful anti-spam law the state enacted this year.

Spokeswoman Linda Sherry of Consumer Action, a San Francisco-based consumer advocacy and education group, called the case a mixed blessing.

"I think that we need to have a show of force by our law enforcement authorities, but the fact remains that it's very, very difficult to even find who's spamming," she said. The judgment is unlikely to deter maverick spammers, she said, because "these guys are pretty arrogant."

She added, "I think people just have to protect themselves. It's going to be a cold day in hell before we have something to protect us against spam."

The suit accused PW Marketing of sending millions of unsolicited e-mails without providing a valid way for recipients to opt out of the mailings, as required by the 1998 law. The e-mails offered a $39 book with tips on making money by sending spam.

Deputy Atty. Gen. Ian K. Sweedler said he had seen no evidence of spam from PW Marketing for about a year. Williams said he believed Willis was in Guadalajara managing other companies' Internet operations.

"PW's been defunct for a long time," he said.

State Sen. Debra Bowen, the Marina del Rey Democrat who sponsored the 1998 anti-spam law, said, "Spam isn't legitimate advertising, and it's not free speech. It's basically high-tech junk faxing that forces e-mail users to pay for someone else's advertising campaign through slower computer service and higher Internet access fees."

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