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Filing lawsuits against those who send spam to consumers, and those who knowingly assist them, is a critical component of Microsoft Corp.’s efforts to contain the spam nuisance that now accounts for more than half of all e-mail. Although suits alone will not solve the spam problem, they accomplish several important goals. First, by suing the highest-volume spammers and seeking injunctions barring defendants from continuing their spamming activity, Microsoft can stop a significant volume of unwanted and allegedly illegal e-mail. Second, lawsuits convey to the public — in clear terms — that those who send deceptive spam are not merely causing annoyance, but are acting illegally. We believe that suits also serve as a deterrent. By creating a major financial disincentive for spammers, the suits help make these business models non-viable. If there is no profit in spamming, existing spammers will leave the market and new spammers will not enter. Microsoft can reinforce this message by recovering all the illegally gained profits that spammers have earned. Last December, after a six-month investigation, Microsoft joined New York Attorney General Eliot Spitzer at his offices in New York City to announce the filing of parallel lawsuits against several defendants, including Scott Richter of Colorado, and the company he heads, OptInRealBig.com LLC. According to Spamhaus.org, a London-based anti-spam and consumer advocacy organization, in Dec. 2003, Richter and his companies collectively constituted the world’s third-largest spammer. Microsoft filed its suits in the King County Superior Court of the State of Washington, charging the defendants with violations of Washington state’s tough anti-spam law — the Washington Commercial Electronic Mail Act — which is similar to the federal “CAN-SPAM” act that went into effect Jan. 1, 2004. Microsoft also alleged violations of a host of federal and state consumer and property protection laws. ( Microsoft v. Synergy6 Inc. et al., No. 03-2-12559-8 SEA.) Attorney General Spitzer filed a lawsuit in the Supreme Court of the State of New York against Richter, his company and a number of associates for violating New York’s consumer protection and false advertising laws. What is especially interesting about these cases is the way the network of spam participants was uncovered and the entire spam network targeted. Identification of the spammers began through an investigative collaboration between Microsoft and the New York Attorney General. Our MSN and Hotmail investigators collected samples of millions of spam e-mails being processed by Microsoft servers and coming from a compromised computer or “unsecure proxy server” in New York City. Spammers often use unsecure proxy servers, which are computers that can be manipulated into sending e-mails while obscuring the true origin of the sender. Microsoft’s investigators provided key MSN information to the AG’s office, which identified several New York-based pieces of the puzzle: the compromised computer, the IP host, and an e-mail marketing firm that was benefiting from the high-volume e-mail campaigns offering a variety of “free” products, ranging from “diamond-cut earrings” to doughnut coupons. Microsoft separately investigated other companies sending high-volume e-mail campaigns through the compromised computer, ranging from Viagra to dating services and Russian “mail-order brides.” The New York marketing company responsible for many of the messages, Synergy6 Inc., allegedly hired affiliates, including Richter and OptInRealBig, to send its e-mail, and these affiliates allegedly subcontracted to other spammers to send the spam e-mails. The parallel lawsuits filed by the New York Attorney General and Microsoft named all these defendants, at each level of this “spam network.” We refer to these efforts as our “root-to-branch” method of investigating spam. The boldness and unique nature of these cases has not been lost on those who could get caught in a network of spam. The lawsuits against Richter and his associates send a clear message that individuals and corporations that knowingly participate in and enable spamming, not just the spammers themselves, will be held responsible for their activity. Spammers cannot avoid culpability by establishing affiliate programs and turning a blind eye to the illegal actions of their affiliates. The cases also highlight the futility of spammers’ attempts to circumvent U.S. laws by moving some or all portions of their operations overseas. Each of the cases involved activities occurring beyond Washington and New York borders, often outside the United States. In the cases Microsoft filed, defendants either routed their e-mail through IP addresses registered in another country, hosted their Web sites in other countries, registered domain names using foreign addresses, or conducted their operations, in part, through offshore companies. We addressed this in the lawsuits by finding the persons in the United States allegedly responsible for directing the illegal activities. MILLIONS Spam costs U.S. businesses millions of dollars each year. At Microsoft, spam consumes massive amounts of our network’s processing power and memory, but more important, spam is our customers’ number one concern. Adult content spam has increased exponentially in the last year, as have spam-based scams in the same period. Perhaps most disturbing is the indication that approximately one in four e-mail users are relying on e-mail less because they are so fed up with spam. These concerns motivate our decision to invest significant resources to curtail spam sent to our customers through a combination of technological innovations, ongoing education, investigation and legal enforcement. We will continue to file suits against spammers, and we will seek additional opportunities to support state and federal government and law enforcement agencies, both in the United States and abroad. We applaud Spitzer’s leadership in fighting to stop spam and similar efforts by the Federal Trade Commission, other attorneys general, and industry leaders. It is only through cooperation and collaboration between industry and government that we can contain spam and help preserve the integrity and security of e-mail. Tim Cranton is senior attorney for Microsoft Corp. in Redmond, Wash.

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