Court Says Porn Company Not Responsible For Spam Sent By Affiliates

from the no-inducement dept

Wed, Mar 26th 2008 1:36am — Mike Masnick

A court has now ruled that Impulse Media is not guilty of spamming because some of its affiliates spammed people. The company, which provides "adult content" has an affiliate program to drive traffic to its site. Some of the people in the affiliate program (not surprisingly) sent out a bunch of spam using their affiliate codes. The government charged that this was Impulse Media's fault. Impulse Media's response was that it forbade spamming in its terms of service and kicked anyone caught spamming out of the program. The government responded that affiliates weren't required to read the terms and anyone kicked out could quickly sign right back up again. However, that wasn't enough to convince the government who found no clear liability for the company. This is a bit of a fine line, but it seems like the correct decision. The government absolutely could have (and probably should have) gone after the affiliates who did spam -- but chose to focus on the wrong company here.

Thank you for reading this Techdirt post. With so many things competing for everyone’s attention these days, we really appreciate you giving us your time. We work hard every day to put quality content out there for our community.

Techdirt is one of the few remaining truly independent media outlets. We do not have a giant corporation behind us, and we rely heavily on our community to support us, in an age when advertisers are increasingly uninterested in sponsoring small, independent sites — especially a site like ours that is unwilling to pull punches in its reporting and analysis.

While other websites have resorted to paywalls, registration requirements, and increasingly annoying/intrusive advertising, we have always kept Techdirt open and available to anyone. But in order to continue doing so, we need your support. We offer a variety of ways for our readers to support us, from direct donations to special subscriptions and cool merchandise — and every little bit helps. Thank you.

–The Techdirt Team

Filed Under: affiliates, spam
Companies: impulse media

28 Comments

If you liked this post, you may also be interested in...

Reader Comments

Subscribe: RSS

View by: Time | Thread

Aron, 26 Mar 2008 @ 3:40am

Actually suffering from this in real time. I run a network which is being spammed by an affiliate of the largest adult friend finding website.

Disappointed by this decision to be honest,it doesn't advance the web one bit. This ruling just enlarges the market for bots and bot runners giving the destination the option to cut payments once the scam is uncovered.

Remember, when the marginal cost of driving traffic is Zero using spam methods, if the financial benefit isgreater than zero then the activity will go ahead.
[ link to this | view in chronology ]
- Anonymous Coward, 26 Mar 2008 @ 4:52am
  
  Re:
  The actual spammers are still liable, though; this just means it's "ok" to hire spammers, but it's still not cool to be one.
  [ link to this | view in chronology ]
- Brooks, 26 Mar 2008 @ 9:12am
  
  Re:
  So what you're saying is that legal principles be damned, you're disappointed in the decision because it doesn't produce the results you would hope for.
  
  Hopefully you remember this if you're ever prosecuted and the jury decides that, while you may not actually have broken the law, convicting you would be a benefit to society. 'Cause that's how you seem to be suggesting the legal system should operate.
  [ link to this | view in chronology ]
The Exorcist, 26 Mar 2008 @ 4:58am

Hey!
Wait a minute.. Shouldn't we have had one raving Mac or Linux fanboy by now telling us that porn and spam don't affect Mac's or Linux?
[ link to this | view in chronology ]
- Anonymous Coward, 26 Mar 2008 @ 6:27am
  
  Re: Hey!
  what the hell does this have to do with the article? Flamebait.
  [ link to this | view in chronology ]
- Anonymous Coward, 26 Mar 2008 @ 6:27am
  
  Re: Hey!
  Pornsites work fine on a Mac, pal. Trust me on this.
  [ link to this | view in chronology ]
  - JS Beckerist, 26 Mar 2008 @ 9:49am
    
    Re: Re: Hey!
    Gmail works fine on macs and in linux too...
    
    Spam is a global network issue, nothing to do with what OS accesses it...
    [ link to this | view in chronology ]
Killer_Tofu (profile), 26 Mar 2008 @ 5:16am

Re #1
As much as I agree that this may encourage spammers running bots, I disagree with you overall.
I believe this is a good decision as I am all for people suing those Actually responsible, and not just whoever the easiest target it. I do not care what the case, be it on the side of spammers, a poster in a forum posting allegedly defamatory comments, or anything of that ilk. If you are going to charge somebody, charge the one actually doing it, not whoever is the easiest target along the chain.
[ link to this | view in chronology ]
Killer_Tofu (profile), 26 Mar 2008 @ 5:19am

Sorry there is more
And this could very well lead to advancing the web. If it leads to many more of the actual spammers being stopped. I hold no delusions that spam will ever stop. But, it will help all of those who are wrongly sued for any reason anywhere because of something somebody else did. That, is what will help the web. Less pointless lawsuits means more advancement (to a not 100% correlated extent).
[ link to this | view in chronology ]
Anonymous Coward, 26 Mar 2008 @ 5:25am

If company A hires company B to drive traffic to their site and company B does it illegally - BOTH COMPANIES SHOULD BE LIABLE!!! DUH!
[ link to this | view in chronology ]
- JS Beckerist, 26 Mar 2008 @ 9:52am
  
  Re:
  That's not what happened here. Company B signs up to company A's site, agreeing to a terms of service. Company B breaks the law. Company A BOOTS company B. Why is Company A still being sued?
  [ link to this | view in chronology ]
- Spam is Crap, 26 Mar 2008 @ 5:48pm
  
  Re:
  If company A hires company B to drive traffic to their site and company B does it illegally - BOTH COMPANIES SHOULD BE LIABLE!!! DUH!
  
  Why? Affiliate programs are common. As I read it, company A specifically forbade Spam as part of its TOS. It doesn't matter that company A is a porn company, what matters is whether or not they specifically hired others to do SPAM, which in this case it does not appear they did.
  [ link to this | view in chronology ]
Anonymous Coward, 26 Mar 2008 @ 5:26am

ok, Since it is illegal for me to #####, I'll hire X to do it for me.
[ link to this | view in chronology ]
Overcast, 26 Mar 2008 @ 5:47am

But... it falls on the ISP's to block file sharing for the entertainment industry?

Yeah... sure... that makes sense.
[ link to this | view in chronology ]
Andy``, 26 Mar 2008 @ 5:59am

If someone steals your car and uses it to commit a robbery, should you get punished too? Now, what if you let them steal your car on purpose?

What matters in this is whether or not Impulse Media knew there were spammers and/or who they were on the network and did nothing to try and stop them. It's impossible to catch everyone and stop everything, but letting them do it and feigning ignorance is something else, especially when you then make a little extra money from such actions.

Problem is, how do you prove they knew? How do you prove one actually hired the other when they can exert tight control over their data, and what happens in circumstances where no actual hiring takes place but they're simply "left alone"?
[ link to this | view in chronology ]
Aron, 26 Mar 2008 @ 6:30am

if I hire someone to break into your house and steal your stuff and then deliver it to me - who is responsible?? In this case, this ruling says that only the one party - they thief can get prosecuted, not the initiator of the action.

OK - I understand that its impossible to vet every source of traffic (supplier) in detail. But still, this judgment is bad for the net.

And if you you start chasing spammers then you'll soon realise that they are smarter and faster and less bureaucratic than the average government agent.

If there was no financial gain from spamming, there would be no spam, believe me. Allowing web sites to employ spammers until they are caught doing so is totally responsible and I hope that EU law is tougher than this.
[ link to this | view in chronology ]
Anonymous Coward, 26 Mar 2008 @ 6:42am

Murder for hire. Who gets charged? Pretty sure its everyone involved.

I leave a loaded gun on my front lawn and someone takes it and shoots my neighbor, who gets charged?

Seems to me they could have went after the porn site for negligence.
[ link to this | view in chronology ]
rc, 26 Mar 2008 @ 6:56am

I seem to remember that the CAN-SPAM laws say that you ARE responsible for emails sent out by affiliates on your behalf, so this is an interesting ruling.

They have to make it painful enough for the company profiting from it that they take greater steps to prevent it.

Otherwise, everyone involved has a big incentive to turn a blind eye to it.

It's also not unknown for companies to set up "affiliates" to have an arms length relationship so they can do practices that the company would burn for if they got caught (think of all the viruses that magically give you suggestions on an antivirus solution to remove them).
[ link to this | view in chronology ]
Anonymous, 26 Mar 2008 @ 7:17am

The real issue is prior knowledge of illegal activity on the part of Impulse Media. If an affiliate promises to stay legal, then it is not the same thing as hiring a hit man since Impulse Media did not intend its affiliates to break the law. It might be a fine legal point, but on such points are cases made and lost.
[ link to this | view in chronology ]
Grammar Poleece Steelin Speelchekkers, 26 Mar 2008 @ 8:40am

Do any of you read your own posts?
I'm starting to believe the real culprits are YOU and YOU and YOU... YES, YOU over there behind the Little Tykes keyboard, you too!

All of you are guilty of stealing intelligent posts. READ YOUR OWN STUFF BEFORE POSTING. Please, for the love of God, show a bit of intelligence.
[ link to this | view in chronology ]
Anonymous Coward, 26 Mar 2008 @ 8:52am

The company TOTALLY knows its affiliates are spamming - think about it.. it's a win-win - they get the traffic, until it's uncovered that someone was spamming and then they get to KEEP the last payment to the affiliate because they suspend his account - the affiliate then signs up under another name and starts the cycle all over again -- it's a corrupt system.

My cousin worked for a dating site which did this. He thought it was sooo clever, even though I told him this was ill moral -- he liked the idea soo much he spun off his own company and is no doubt doing the same thing. 3 months after going into business, he is making $15,000.00 a day
[ link to this | view in chronology ]
Anonymous Coward, 26 Mar 2008 @ 9:06am

"The government responded that affiliates weren't required to read the terms". Does this mean there wasn't a little check box saying "I have read and agree to the terms"? You can't force someone to read something, all you can do is give them the option and ability, but they are still bound by those terms, read or not. I have to agree, if the terms say no spamming, the ones who sent the emails and not Impulse Media are the ones who should have been charged.

If I was Impulse, I would include in the terms this clause: "payments will be not be sent until the following month, anyone found violating these terms will forfeit all monies not sent." This gives Impulse 30 days to locate violaters, it may sound like a great way for Impulse to be able to "steal" money earned by affiliates, but if they try that people will stop signing up.
[ link to this | view in chronology ]
Rich Kulawiec, 26 Mar 2008 @ 9:27am

Affiliates == spamming
That's a rule of thumb that everyone who's been working in the anti-spam area for any time knows. This ruling does nothing to change that. (While it may, according to this particular ruling in this particular case in this particular jurisdiction , be the case that there is no finding of legal liability against the mothership, that doesn't stop any of us from holding them responsible and expressing that via firewall rules.)
[ link to this | view in chronology ]
Rose M. Welch, 26 Mar 2008 @ 10:01am

I don't know where some of y'all are from...
...but in American, you're supposed to be innocent until proven guilty. In this case, no one could prove that the porn company knew that the ad company was spamming. So I'm happy with the result of this case.

Yeah, I think that they probably did know, but if you start convicting and sentencing on gut feelings instead of law and evidence, then poof! Good-bye, America, in one fell swoop. Hi, Gestapo!
[ link to this | view in chronology ]
Tricia, 26 Mar 2008 @ 7:09pm

Interesting Case
This case opens up a lot of different issues if other courts decide to follow the decision. It would be interesting to see the actual evidence. For example, did the government point to the exact affiliates that spammed, and were those exact affiliates banned? Did Impulse ban EVERY affiliate caught using their links via email when they were meant for web and search only? Questions that we probably will not know the answer to but would make a difference in the eyes of a good jury.
[ link to this | view in chronology ]
victor louis, 31 Mar 2008 @ 11:30pm

Anti spam webinar
Spammers Vs Today’s spam filters

Today’s spam filters are not accurate and spam volumes are increasing rapidly. This will cost $42 billion for US alone. Spammers are using more innovation technology to send spam mails & Today’s spam filters are blocking only 80% of spam mails.

Register for a complimentary Webinar conducted by Abaca and Ferris research to know more about the spammers behind the black market. To register please click the link below:
http://www.surveymonkey.com/s.aspx?sm=LPFKkdkFwOYltiQZtM_2bttw_3d_3d
[ link to this | view in chronology ]
Soupgoblin, 18 Apr 2008 @ 4:00pm

spammers must die!
So.

How many people think it is OK to go after the companies that hire illegal immigrants, and fine them, think that letting this company off the hook is a good idea?

The illegals only come here knowing that some company will pay them starvation wages to work, fine theheck out of those companies and no more illegal immigrants, same with spammers, they don't just spam for fun, they make money from it, start prosecuting the companies that hire spammers, then when the money goes away, so does the spam.

Same deal, If you fine a company for having shoddy business practices, then they will have to stay within legal limits, if you look the other way, then don't cry about the spam.

Being a coward and letting people walk all over you doesn't always work in your favor.
[ link to this | view in chronology ]
mlmaffiliate affiliate, 24 Mar 2009 @ 3:49pm

mlmaffiliate
Be clear about what you want to achieve with MLM affiliates program. However, ensure that your goals are flexible enough to accommodate unexpected developments.
[ link to this | view in chronology ]