Asis Internet Services v. Consumerbargaingiveaways, LLC

Asis Internet Services and another business (together, Asis) (plaintiffs) were internet and email service providers in a rural part of California. Asis had about 1,000 customers who, between August 2007 and September 2008, received email advertisements from Consumerbargaingiveaways, LLC, and a few other entities (the businesses) (defendants) that either contained falsified header information or contained a subject line that would likely mislead the recipient. The businesses’ challenged emails suggested that the recipient had received a free gift or prize, like a $500 gift card, when in fact the recipient had to take various steps to obtain the purported gift, such as open a credit card, so that the gift was not actually free. Alternatively, the “from” line of the email, located in the header, would contain a name that was similar to the recipient. The header also sometimes contained disguised internet-protocol addresses. In October 2008, Asis sued the businesses, alleging violations of California Business and Professions Code § 17529.5(a). Section 17529.5(a) defined unlawful activities relating to commercial email advertisements. The businesses filed a motion to dismiss, arguing that § 17529.5(a) was preempted by a federal law regarding commercial email, 15 U.S.C. § 7701 et seq. (the CAN-SPAM Act or the act). According to the businesses, the act preempted all state laws on the same subject matter except for common-law-fraud claims. The businesses also argued that Asis lacked standing or was untimely.