CompuServe v. Cyber Promotions, Inc.,
962 F. Supp. 1015
(S.D. Ohio 1997).
IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF OHIO
EASTERN DIVISION
CompuServe Incorporated, Plaintiff,
vs.
Cyber Promotions, Inc. and Sanford Wallace, Defendants.
Case No. C2-96-1070
JUDGE GRAHAM
February 3, 1997
MEMORANDUM OPINION AND ORDER
This case presents novel issues regarding the commercial use
of the Internet, specifically the right of an online computer
service to prevent a commercial enterprise from sending unsolicited
electronic mail advertising to its subscribers.
Plaintiff CompuServe Incorporated ("CompuServe") is one of the
major national commercial online computer services. It operates a
computer communication service through a proprietary nationwide
computer network. In addition to allowing access to the extensive
content available within its own proprietary network, CompuServe
also provides its subscribers with a link to the much larger
resources of the Internet. This allows its subscribers to send and
receive electronic messages, known as "e-mail," by the Internet.
Defendants Cyber Promotions, Inc. and its president Sanford Wallace
are in the business of sending unsolicited e-mail advertisements on
behalf of themselves and their clients to hundreds of thousands of
Internet users, many of whom are CompuServe subscribers.
CompuServe has notified defendants that they are prohibited from
using its computer equipment to process and store the unsolicited
e-mail and has requested that they terminate the practice.
Instead, defendants have sent an increasing volume of e-mail
solicitations to CompuServe subscribers. CompuServe has attempted
to employ technological means to block the flow of defendants'
e-mail transmissions to its computer equipment, but to no avail.
This matter is before the Court on the application of
CompuServe for a preliminary injunction which would extend the
duration of the temporary restraining order issued by this Court on
October 24, 1996 and which would in addition prevent defendant from
sending unsolicited advertisements to CompuServe subscribers.
For the reasons which follow, this Court holds that where
defendants engaged in a course of conduct of transmitting a
substantial volume of electronic data in the form of unsolicited
e-mail to plaintiff's proprietary computer equipment, where
defendants continued such practice after repeated demands to cease
and desist, and where defendants deliberately evaded plaintiff's
affirmative efforts to protect its computer equipment from such
use, plaintiff has a viable claim for trespass to personal property
and is entitled to injunctive relief to protect its property.
I.
The Court will begin its analysis of the issues by
acknowledging, for the purpose of providing a background, certain
findings of fact recently made by another district court in a case
involving the Internet:
1. The Internet is not a physical or tangible entity, but
rather a giant network which interconnects innumerable smaller
groups of linked computer networks. It is thus a network of
networks. . . .
2. Some networks are "closed" networks, not linked to other
computers or networks. Many networks, however, are connected
to other networks, which are in turn connected to other
networks in a manner which permits each computer in any
network to communicate with computers on any other network in
the system. This global Web of linked networks and computers
is referred to as the Internet.
3. The nature of the Internet is such that it is very
difficult, if not impossible, to determine its size at a given
moment. It in indisputable, however, that the Internet has
experienced extraordinary growth in recent
years. . . . In all, reasonable estimates are
that as many as 40 million people around the world can and do
access the enormously flexible communication Internet medium.
That figure is expected to grow to 200 million Internet users
by the year 1999.
4. Some of the computers and computer networks that make up
the network are owned by governmental and public institutions,
some are owned by non-profit organizations, and some are
privately owned. The resulting whole is a decentralized,
global medium of communications -- or "cyberspace" -- that
links people, institutions, corporations, and governments
around the world. . . .
. . . .
11. No single entity -- academic, corporate, governmental, or
non-profit administers the Internet. It exists and functions
as a result of the fact that hundreds of thousands of separate
operators of computers and computer networks independently
decided to use common data transfer protocols to exchange
communications and information with other computers (which in
turn exchange communications and information with still other
computers). There is no centralized storage location, control
point, or communications channel for the Internet, and it
would not be technically feasible for a single entity to
control all of the information conveyed on the Internet.
American Civil Liberties Union v. Reno, 929 F. Supp. 824,
830-832 (E.D. Pa. 1996). In 1994, one commentator noted that
"advertisements on the current Internet computer network are not
common because of the network's not-for-profit origins." Trotter
Hardy, The Proper Legal Regime for "Cyberspace", 55 U. Pitt.
L. Rev. 993, 1027 (1994). In 1997, that statement is no longer
true.
Internet users often pay a fee for Internet access. However
there is no per-message charge to send electronic messages over the
Internet and such messages usually reach their destination within
minutes. Thus electronic mail provides an opportunity to reach a
wide audience quickly and at almost no cost to the sender. It is
not surprising therefore that some companies, like defendant Cyber
Promotions, Inc., have begun using the Internet to distribute
advertisements by sending the same unsolicited commercial message
to hundreds of thousands of Internet users at once. Defendants
refer to this as "bulk e-mail," while plaintiff refers to it as
"junk e-mail." In the vernacular of the Internet, unsolicited
e-mail advertising is sometimes referred to pejoratively as
"spam."1
CompuServe subscribers use CompuServe's domain name
"CompuServe.com" together with their own unique alphanumeric
identifier to form a distinctive e-mail mailing address. That
address may be used by the subscriber to exchange electronic mail
with any one of tens of millions of other Internet users who have
electronic mail capability. E-mail sent to CompuServe subscribers
is processed and stored on CompuServe's proprietary computer
equipment. Thereafter, it becomes accessible to CompuServe's
subscribers, who can access CompuServe's equipment and
electronically retrieve those messages.
Over the past several months, CompuServe has received many
complaints from subscribers threatening to discontinue their
subscription unless CompuServe prohibits electronic mass mailers
from using its equipment to send unsolicited advertisements.
CompuServe asserts that the volume of messages generated by such
mass mailings places a significant burden on its equipment which
has finite processing and storage capacity. CompuServe receives no
payment from the mass mailers for processing their unsolicited
advertising. However, CompuServe's subscribers pay for their
access to CompuServe's services in increments of time and thus the
process of accessing, reviewing and discarding unsolicited e-mail
costs them money, which is one of the reasons for their complaints.
CompuServe has notified defendants that they are prohibited from
using its proprietary computer equipment to process and store
unsolicited e-mail and has requested them to cease and desist from
sending unsolicited e-mail to its subscribers. Nonetheless,
defendants have sent an increasing volume of e-mail solicitations
to CompuServe subscribers.
In an effort to shield its equipment from defendants' bulk
e-mail, CompuServe has implemented software programs designed to
screen out the messages and block their receipt. In response,
defendants have modified their equipment and the messages they send
in such a fashion as to circumvent CompuServe's screening software.
Allegedly, defendants have been able to conceal the true origin of
their messages by falsifying the point-of-origin information
contained in the header of the electronic messages. Defendants have
removed the "sender" information in the header of their messages
and replaced it with another address. Also, defendants have
developed the capability of configuring their computer servers to
conceal their true domain name and appear on the Internet as
another computer, further concealing the true origin of the
messages. By manipulating this data, defendants have been able to
continue sending messages to CompuServe's equipment in spite of
CompuServe's protests and protective efforts.
Defendants assert that they possess the right to continue to
send these communications to CompuServe subscribers. CompuServe
contends that, in doing so, the defendants are trespassing upon its
personal property.
II.
The grant or denial of a motion for preliminary injunction
rests within the discretion of the trial court. Deckert v.
Independence Shares Corp., 311 U.S. 282 (1940). In determining
whether a motion for preliminary injunction should be granted, a
court must consider and balance four factors: (1) the likelihood
that the party seeking the preliminary injunction will succeed on
the merits of the claim; (2) whether the party seeking the
injunction will suffer irreparable harm without the grant of the
extraordinary relief; (3) the probability that granting the
injunction will cause substantial harm to others; and (4) whether
the public interest is advanced by the issuance of the injunction.
Washington v. Reno, 35 F.3d 1093, 1099 (6th Cir. 1994);
International Longshoremen's Assoc. v. Norfolk S. Corp., 927
F.2d 900, 903 (6th Cir. 1991). None of these individual factors
constitute prerequisites that must be met for the issuance of a
preliminary injunction, they are instead factors that are to be
balanced. In re DeLorean Motor Co., 755 F.2d 1223, 1229
(6th Cir. 1985). A preliminary injunction is customarily granted
on the basis of procedures that are less formal and evidence that
is less complete than in a full trial on the merits. Indeed, "[a]
party . . . is not required to prove his case in full at
a preliminary injunction hearings." University of Texas v.
Camenisch, 451 U.S. 390, 395 (1981).
III.
This court shall first address plaintiff's motion as it
relates to perpetuating the temporary restraining order filed on
October 24, 1996. That order enjoins defendants from:
(i) Using CompuServe accounts or CompuServe's equipment or
support services to send or receive electronic mail or
messages or in connection with the sending or receiving of
electronic mail or messages;
(ii) Inserting any false reference to a CompuServe account or
CompuServe account or equipment in any electronic message sent
by Defendants; and
(iii) Falsely representing or causing their electronic mail or
messages to bear the representation that any electronic mail
or message sent by Defendants was sent by or originated from
CompuServe or a CompuServe account.
(Temporary Restraining Order at 4).
As a general matter, the findings of this Court enunciated in
its temporary restraining order are applicable to the request for
preliminary injunction now at issue. The behavior described in
subsections (ii) and (iii) of the temporary restraining order would
be actionable as false representations or descriptions under
§43(a) of the Lanham Act, 15 U.S.C. §1125(a). Also, the
same behavior is actionable under the Ohio Deceptive Trade
Practices Act, Ohio Rev. Code §4165(B) and (D).
Defendants argue that the restrictions in the temporary
restraining order are no longer necessary because defendants no
longer have a CompuServe account. That being the case, a
preliminary injunction perpetuating the prescribed activity
articulated in subsection (i) of the temporary restraining order
will present no hardship at all to defendants. Next, it does not
appear that defendants would need to have a CompuServe account to
perpetrate the prescribed acts articulated in subsections (ii) and
(iii) of the temporary restraining order. Therefore, the fact that
defendants no longer have an account with plaintiff does not
vitiate the need which CompuServe has demonstrated for an
injunction prescribing the acts set forth in those subsections.
For the foregoing reasons and the reasons articulated in the
temporary restraining order issued by this Court, defendants Cyber
Promotions, Inc. and its president Sanford Wallace are hereby
enjoined from performing any of the acts therein described during
the pendency of this litigation.
IV.
This Court will now address the second aspect of plaintiff's
motion in which it seeks to enjoin defendants Cyber Promotions,
Inc. and its president Sanford Wallace from sending any unsolicited
advertisements to any electronic mail address maintained by
CompuServe.
CompuServe predicates this aspect of its motion for
preliminary injunction on the common law theory of trespass to
personal property or to chattels, asserting that defendants
continued transmission of electronic messages to its computer
equipment constitutes an actionable tort.
Trespass to chattels has evolved from its original common law
application, concerning primarily the asportation of another's
tangible property, to include the unauthorized use of personal
property.
Its chief importance now, is that there may be
recovery. . . . for interferences with the
possession of chattels which are not sufficiently important to
be classed as conversion, and so to compel the defendant to
pay the full value of the thing with which he has interfered.
Trespass to chattels survives today, in other words, largely
as a little brother of conversion.
Prosser & Keeton, Prosser and Keeton on Torts, §14,
85-86 (1984).
The scope of an action for conversion recognized in Ohio may
embrace the facts in the instant case. The Supreme Court of Ohio
established the definition of conversion under Ohio law in
Baltimore & O.R. Co. v. O'Donnell, 49 Ohio St. 489, 32
N.E. 476, 478 (1892) by stating that:
[I]n order to constitute a conversion, it was not necessary
that there should have been an actual appropriation of the
property by the defendant to its own use and benefit. It
might arise from the exercise of a dominion over it in
exclusion of the rights of the owner, or withholding it from
his possession under a claim inconsistent with his rights. If
one take the property of another, for a temporary purpose
only, in disregard of the owner's right, it is a conversion.
Either a wrongful taking, an assumption of ownership, an
illegal use or misuse, or a wrongful detention of chattels
will constitute a conversion.
Id. at 497-98, see also Miller v. Uhl, 37 Ohio App.
276, 174 N.B. 591 (1929); Great American Mut. Indem. Co. v.
Meyer, 18 Ohio App. 97 (1924); 18 O. Jur. 3d, Conversion
§17. While authority under Ohio law respecting an action for
trespass to chattels is extremely meager, it appears to be an
actionable tort. See State of Ohio v. Herbert, 49 Ohio St.
2d 88, 119, 358 N.E. 2d 1090, 1106 (1976) (dissenting opinion)
("any workable cause of action would appear to be trespass to
chattels"); see also Greenwald v. Kearns, 104 Ohio App. 473,
145 N.E. 2d 462 (1957) (trespass on the rights of plaintiff in
personal property is a precursor to an act in conversion);
Simmons v. Dimitrouleas Wallcovering, Inc., No. 14804, 1995
WL 19136, at *2 (Ohio App. Jan. 18, 1995) (the court of appeals
acknowledged that trespass to chattel claims were barred because
those claims were dependent upon claimant's ownership of the
subject personal property); Klienbriel v. Smith, No.
94CA1641, 1996 WL 57947, at *2 (Ohio App. Feb. 6, 1996) (where the
court of appeals let stand a jury award on a "trespass against
personal property" claim); Springfield Bank v. Casserta, 10
B.R. 57 (Bankr. S.D. Ohio 1981) (common law principles of trespass
to chattels in Am. Jur. 2d applied as controlling under Ohio law).
Both plaintiff and defendants cite the Restatement (Second) of
Torts to support their respective positions. In determining a
question unanswered by state law, it is appropriate for this Court
to consider such sources as the restatement of the law and
decisions of other jurisdictions. Bailey v. V & O Press
Co., Inc., 770 F.2d 601, 604-606 (6th Cir. 1985) (where court
considered positions expressed in the Restatement (Second) of Torts
in interpreting Ohio's principles of comparative negligence);
Garrison v. Jervis B. Webb Co., 583 F.2d 258, 262 n. 6
(1978); see also Wright, Miller & Cooper, Federal
Practice and Procedure, §4507 (West 1996).
The Restatement §217(b) states that a trespass to Chattel
may be committed by intentionally using or intentionally using or
intermeddling with the chattel in possession of another.
Restatement §217, Comment e defines physical "intermeddling"
as follows:
. . . intentionally bringing about a physical
contact with the chattel. The actor may commit a trespass by
an act which brings him into an intended physical contact with
a chattel in the possession of another[.]
Electronic signals generated and sent by computer have been
held to be sufficiently physically tangible to support a trespass
cause of action. Thrifty-Tel, Inc. v. Bezeneck, 56 Cal. App.
4th 1559, 1567 (1996); State v. McGraw, 480 N.E. 2d 552, 554
(Ind. 1985) (Indiana Supreme Court recognizing in dicta that a
hacker's unauthorized access to a Computer was more in the nature
of trespass than criminal conversion); and State v. Riley,
121 Wash. 2d 22, 846 P.2d 1365 (1993) (computer hacking as the
criminal offense of "computer trespass" under Washington law). It
is undisputed that plaintiff has a possessory interest in its
computer systems. Further, defendants' contact with plaintiff's
computers is clearly intentional. Although electronic messages may
travel through the Internet over various routes, the massages are
affirmatively directed to their destination.
Defendants, citing Restatement (Second) of Torts §221,
which defines "disposition", assert that not every interference
with the personal property of another is actionable and that
physical dispossession or substantial interference with the
chattel is required. Defendants then argue that they did not, in
this case, physically dispossess plaintiff of its equipment or
substantially interfere with it. However, the Restatement (Second)
of Torts §218 defines the circumstances under which a trespass
to chattels may be actionable:
One who commits a trespass to a chattel is subject to
liability to the possessor of the chattel if, but only if,
(a) he dispossessed the other of the chattel, or
(b) the chattel is impaired as to its condition, quality, or
value, or
(c) the possessor is deprived of the use of the chattel for a
substantial time, or
(d) bodily harm is caused to the possessor, or harm is caused
to some person or thing in which the possessor has a legally
protected interest.
Therefore, an interference resulting in physical dispossession is
in just one circumstance under which a defendant can be found
liable. Defendants suggest that "[u]nless an alleged trespasser
actually takes physical custody of the property or physically
damages it, courts will not find the 'substantial interference'
required to maintain a trespass to chattel claim." (Defendant's
Memorandum at 13). To support this rather broad proposition,
defendants cite only two cases which make any reference to the
Restatement. In Glidden v. Szybiak, 95 N.H. 318, 63 A.2d
233 (1949), the court simply indicated that an action for trespass
to chattels could not be maintained in the absence of some form of
damage. The court held that where plaintiff did not contend that
defendant's pulling on her pet dog's ears caused any injury, an
action in tort could not be maintained. Id. at 235. In
contrast, plaintiff in the present action has alleged that it has
suffered several types of injury as a result of defendants'
conduct. In Koepnick v. Sears Roebuck & Co., 158 Ariz.
322, 762 P.2d 609 (1988) the court held that a two-minute search of
an individual's truck did not amount to a "dispossession" of the
truck as defined in Restatement §221 or a deprivation of the
use of the truck for a substantial time. It is clear from a
reading of Restatement §218 that an interference or
intermeddling that does not fit the §221 definition of
"dispossession" can nonetheless result in defendants', liability
for trespass. The Koepnick court did not discuss any of the
other grounds for liability under Restatement §218.
A plaintiff can sustain an action for trespass to chattels, as
opposed to an action for conversion, without showing a substantial
interference with its right to possession of that chattel.
Thrifty-Tel, Inc., 46 Cal. App. 4th at 1567 (quoting
Zaalow v. Kroenert, 29 Cal. 2d 541, 176 P.2d 1 (Cal. 1946)).
Harm to the personal property or diminution of its quality,
condition, or value as a result of defendants' use can also be the
predicate for liability. Restatement §218(b).
An unprivileged use or other intermeddling with a chattel
which results in actual impairment of its physical condition,
quality or value to the possessor makes the actor liable for
the loss thus caused. In the great majority of cases, the
actor's intermeddling with the chattel impairs the value of it
to the possessor, as distinguished from the mere affront to
his dignity as possessor, only by some impairment of the
physical condition of the chattel. There may, however, be
situations in which the value to the owner of a particular
type of chattel may be impaired by dealing with it in a manner
that does not affect its physical
condition. . . . In such a case, the
intermeddling is actionable even though the physical condition
of the chattel is not impaired.
The Restatement (Second) of Torts §218, comment h. In the
present case, any value CompuServe realizes from its computer
equipment is wholly derived from the extent to which that equipment
can serve its subscriber base. Michael Mangino, a software
developer for CompuServe who monitors its mail processing computer
equipment states by affidavit that handling the enormous volume of
mass mailings that CompuServe receives places a tremendous burden
on its equipment. (Mangino Supp. Dec. at ¶12). Defendants'
more recent practice of evading CompuServe's filters by disguising
the origin of their messages commandeers even more computer
resources because CompuServe computers are forced to store
undeliverable e-mail messages and labor in vain to return the
messages to an address that does not exist. (Mangino Supp. Dec. at
¶¶7-8). To the extent that defendants' multitudinous
electronic mailings demand the disk space and drain the processing
power of plaintiff's computer equipment, those resources are not
available to serve CompuServe subscribers. Therefore, the value of
that equipment to CompuServe is diminished even though it is not
physically damaged by defendants' conduct.
Next, plaintiff asserts that it has suffered injury aside from
the physical impact of defendants' messages on its equipment.
Restatement §218(d) also indicates that recovery may be had
for a trespass that causes harm to something in which the possessor
has a legally protected interest. Plaintiff asserts that
defendants' messages are largely unwanted by its subscribers, who
pay incrementally to access their e-mail, read it, and discard it.
Also, the receipt of a bundle of unsolicited messages at once can
require the subscriber to sift through, at his expense, all of the
messages in order to find the ones he wanted or expected to
receive. These inconveniences decrease the utility of CompuServe's
e-mail service and are the foremost subject in recent complaints
from CompuServe subscribers. Patrick Hole, a customer service
manager for plaintiff, states by affidavit that in November 1996
CompuServe received approximately 9,970 e-mail complaints from
subscribers about junk e-mail, a figure up from approximately two
hundred complaints the previous year. (Hole 2d Supp. Dec. at
¶4). Approximately fifty such complaints per day specifically
reference defendants. (Hole Supp. Dec. at ¶3). Defendants
contend that CompuServe subscribers are provided with a simple
procedure to remove themselves from the mailing list. However, the
removal procedure must be performed by the e-mail recipient at his
expense, and some CompuServe subscribers complain that the
procedure is inadequate and ineffectual. (See, e.g., Hole Supp.
Dec. at ¶8).
Many subscribers have terminated their accounts specifically
because of the unwanted receipt of bulk e-mail messages. (Hole
Supp. Dec. at ¶9, Hole 2d Supp. Dec. at ¶6). Defendants'
intrusions into CompuServe's computer systems, insofar as they harm
plaintiff's business reputation and goodwill with its customers,
are actionable under Restatement §218(d).
The reason that the tort of trespass to chattels requires some
actual damage as a prima facie element, whereas damage is
assumed where there is a trespass to real property, can be
explained as follows:
The interest of a possessor of a chattel in its inviolability,
unlike the similar interest of a possessor of land, is not
given legal protection by an action for nominal damages for
harmless intermeddlings with the chattel. In order that an
actor who interferes with another's chattel may be liable, his
conduct must affect some other and more important interest of
the possessor. Therefore, one who intentionally intermeddles
with another's chattel is subject to liability only if his
intermeddling is harmful to the possessor's materially
valuable interest in the physical condition, quality, or value
of the chattel, or if the possessor is deprived of the use of
the chattel for a substantial time, or some other legally
protected interest of the possessor is affected as stated in
Clause (c). Sufficient legal protection of the possessor's
interest in the mere inviolability of his chattel is afforded
by his privilege to use reasonable force to protect his
possession against even harmless interference.
Restatement (Second) of Torts §218, Comment e (emphasis
added). Plaintiff CompuServe has attempted to exercise this
privilege to protect its computer systems. However, defendant's
affirmative efforts to evade plaintiff's security measures have
circumvented any protection those self-help measures might have
provided. In this case CompuServe has alleged and supported by
affidavit that it has suffered several types of injury as a result
of defendants' conduct. The foregoing discussion simply
underscores that the damage sustained by plaintiff is sufficient to
sustain an action for trespass to chattels. However, this Court
also notes that the implementation of technological means of self-
help, to the extent that reasonable measures are effective, is
particularly appropriate in this type of situation and should be
exhausted before legal action is proper.
Under Restatement §252, the owner of personal property
can create a privilege in the would-be trespasser by granting
consent to use the property. A great portion of the utility of
CompuServe's e-mail service is that it allows subscribers to receive
messages from individuals and entities located anywhere on the Internet.
Certainly, then, there is at least a tacit invitation for anyone on
the Internet to utilize plaintiff's computer equipment to send e-mail
to its subscribers.2
Buchanan Marine, Inc. v. McCormack Sand Co., 743 F. Supp.
139 (E.D.N.Y. 1990) (whether there is consent to community use is
a material issue of fact in an action for trespass to chattels).
However, in or around October 1995, CompuServe employee Jon Schmidt
specifically told Mr. Wallace that he was "prohibited from using
CompuServe's equipment to send his junk e-mail messages." (Schmidt
Dec. at ¶5). There is apparently some factual dispute as to
this point, but it is clear from the record that Mr. Wallace became
aware at about this time that plaintiff did not want to receive
messages from Cyber Promotions and that plaintiff was taking steps
to block receipt of those messages. (Transcript of December 15,
1996 Hearing at 81-86).
Defendants argue that plaintiff made the business decision to
connect to the Internet and that therefore it cannot now
successfully maintain an action for trespass to chattels. Their
argument is analogous to the argument that because an establishment
invites the public to enter its property for business purposes, it
cannot later restrict or revoke access to that property, a
proposition which is erroneous under Ohio law. See, e.g., State
v. Carriker, 5 Ohio App. 2d 255, 214 N.E. 2d 809 (1964) (the
law in Ohio is that a business invitee's privilege to remain on the
premises of another may be revoked upon the reasonable notification
to leave by the owner or his agents); Allstate Ins. Co. v. U.S.
Associates Realty, Inc., 11 Ohio App. 3d 242, 464 N.E. 2d 169
(1983) (notice of express restriction or limitation on invitation
turns business invitee into trespasser). On or around October 1995,
CompuServe notified defendants that it no longer consented to the
use of its proprietary computer equipment. Defendants' continued
use thereafter was a trespass. Restatement (Second) of Torts
§§252 and 892A(5); see also Restatement (Second)
of Torts §217, Comment f ("The actor may commit a new trespass
by continuing an intermeddling which he has already begun, with or
without the consent of the person in possession. Such
intermeddling may persist after the other's consent, originally
given, has been terminated."); Restatement (Second) of Torts
§217, Comment g.
Further, CompuServe expressly limits the consent it grants to
Internet users to send e-mail to its proprietary computer systems
by denying unauthorized parties the use of CompuServe equipment to
send unsolicited electronic mail messages. (Kolehmainen Dec. at
¶2). This policy statement, posted by CompuServe online,
states as follows:
CompuServe is a private online and communications services
company. CompuServe does not permit its facilities to be used
by unauthorized parties to process and store unsolicited
e-mail. If an unauthorized party attempts to send unsolicited
messages to e-mail addresses on a CompuServe service,
CompuServe will take appropriate action to attempt to prevent
those messages from being processed by CompuServe. Violations
of CompuServe's policy prohibiting unsolicited e-mail should
be reported to . . . .
Id. at ¶¶2 and 3. Defendants Cyber Promotions,
Inc. and its president Sanford Wallace have used plaintiff's
equipment in a fashion that exceeds that consent. The use of
personal property exceeding consent in a trespass. City of
Amsterdam v. Daniel Goldreyer, Ltd., 882 F. Supp. 1273
(E.D.N.Y. 1995); Restatement (Second) of Torts §256. It is
arguable that CompuServe's policy statement, insofar as it may
serve as a limitation upon the scope of its consent to the use of
its computer equipment, may be insufficiently communicated to
potential third-party users when it is merely posted at some
location on the network. However, in the present case the record
indicates that defendants were actually notified that they were
using CompuServe's equipment in an unacceptable manner. To prove
that a would-be trespasser acted with the intent required to
support liability in tort it is crucial that defendant be placed on
notice that he is trespassing.
As a general matter, the public possesses a privilege to
reasonably use the facilities of a public utility, Restatement
(Second) of Torts §259, but Internet service providers have
been held not to be common carriers. Religious Technology
Center v. Netcom On-Line Communications Services, Inc., 907 F.
Supp. 1361 (N.D.Cal. 1995). The definition of public utility status
under Ohio law was recently articulated in A & B Refuse
Disposers, Inc. v. Bd. of Ravenna Township Trustees, 64 Ohio
St. 3d 385, 596 N.E. 2d 423 (1992). The Ohio Supreme Court held
that the determination of whether an entity is a "public utility"
requires consideration of several factors relating to the "public
service" and "public concern" characteristics of a public utility.
Id. at 426. The public service characteristic contemplates
an entity which devotes an essential good or service to the general
public which the public in turn has a legal right to demand or
receive. Id. at 425. CompuServe's network, Internet access
and electronic mail services are simply not essential to society.
There are many alternative forms of communication which are
customarily used for the same purposes. Further, only a minority
of society at large has the equipment to send and receive e-mail
messages via the Internet, and even fewer actually do. The second
characteristic of a public utility contemplates an entity which
conducts its operations in such manner as to be a matter of public
concern, that is, a public utility normally occupies a monopolistic
or ogopolistic position in the relevant marketplace. Id. at
425-426. Defendants estimate that plaintiff serves some five
million Internet users worldwide. However, there are a number of
major Internet service providers that have very large subscriber
bases, and with a relatively minor capital investment, anyone can
acquire the computer necessary to provide Internet access services
on a smaller scale. Furthermore, Internet users are not a "captive
audience" to any single service provider, but can transfer from one
service to another until they find one that best suits their needs.
Finally, the Ohio Supreme Court made clear that a party asserting
public utility status is required to support that assertion with
evidence going to the relevant aforementioned factors. Id.
at 427. Defendants have not argued that CompuServe is a public
utility, much less produced evidence tending to support such a
conclusion. Therefore, CompuServe is not a public utility as that
status is defined under Ohio law and defendants can not be said to
enjoy a special privilege to use CompuServe's proprietary computer
systems.
In response to the trespass claim, defendants argue that they
have the right to continue to send unsolicited commercial e-mail to
plaintiff's computer systems under the First Amendment to the
United States Constitution. The First Amendment states that
"Congress shall make no law respecting an establishment of
religion, or prohibiting the free exercise thereof; or abridging
the freedom of speech, or of the press." The United States Supreme
Court has recognized that "the constitutional guarantee of free
speech is a guarantee only against abridgement by government,
federal or state." Hudgens v. NLRB, 424 U.S. 507, 513
(1976). Indeed, the protection of the First Amendment is not a
shield against "merely private conduct." Hurley v. Irish-
American Gay Group of Boston, --- U.S. ---, ---, 115 S.Ct.
2338, 2344 (1995) (citation omitted).
Very recently, in an action filed by Cyber Promotions, Inc.
against America Online, Inc. ("AOL") the United States District
Court for the Eastern District of Pennsylvania held that AOL, a
company selling services that are similar to those of CompuServe,
is a private actor. Cyber Promotions, Inc. v. America Online,
Inc., 1996 WL 633702, *9 (E.D.Pa. 1996). That case involved
the question of whether Cyber Promotions had the First Amendment
right to send unobstructed e-mail to AOL subscribers. The court
held that Cyber Promotions had no such right and that, inter alia,
AOL was not exercising powers that are traditionally the exclusive
prerogative of the state, such as where a private company exercises
municipal powers by running a company town. Id. at *7;
Blum v. Yaretsky, 457 U.S. 991, 1004-05 (1982); Marsh v.
Alabama, 326 U.S. 501 (1946). This Court agrees with the
conclusions reached by the United States District Court for the
Eastern District of Pennsylvania.
In the present action, CompuServe is a private company.
Moreover, the mere judicial enforcement of neutral trespass laws by
the private owner of property does not alone render it a state
actor. Rotunda & Nowak, Treatise on Constitutional Law
§16.3, 546 (West 1992). Defendants do not argue that
CompuServe is anything other than a private actor. Instead,
defendants urge that because CompuServe is so intimately involved
in this new medium it might be subject to some special form of
regulation. Defendants cite Associated Press v. United
States, 326 U.S. 1 (1945), and Turner Broadcasting Sys.,
Inc. v. FCC, --- U.S. ---, 114 S. Ct. 2445 (1994), which stand
for the proposition that when a private actor has a certain quantum
of control over a central avenue of communication, then the First
Amendment might not prevent the government from enacting
legislation requiring public access to private property. No such
legislation yet exists that is applicable to CompuServe. Further,
defendants discussion concerning the extent to which the Internet
may be regulated (or should be regulated) is irrelevant because no
government entity has undertaken to regulate the Internet in a
manner that is applicable to this action. Indeed, if there were
some applicable statutory scheme in place this Court would not be
required to apply paradigms of common law to the case at hand.
In Lloyd Corp. v. Tanner, 407 U.S. 551 (1972), protestors of
the Vietnam War sought to pass out written materials in a private
shopping center. Even though the customers of the shopping center
were the intended recipients of the communication, the Supreme
Court held that allowing the First Amendment to trump private
property rights is unwarranted where there are adequate alternative
avenues of communication. Id. at 567. The Supreme Court
stated that:
Although . . . the courts properly have shown a
special solicitude for the guarantees of the First Amendment,
this Court has never held that a trespasser or an uninvited
guest may exercise general rights of free speech on property
privately owned and used nondiscriminatorily for private
purposes only.
Id. at 567-68 (emphasis added). Defendants in the present
action have adequate alternative means of communication available
to them. Not only are they free to send e-mail advertisements to
those on the Internet who do not use CompuServe accounts, but they
can communicate to CompuServe subscribers as well through online
bulletin boards, web page advertisements, or facsimile
transmissions, as well as through more conventional means such as
the U.S. mail or telemarketing. Defendants' contention, referring
to the low cost of the electronic mail medium, that there are no
adequate alternative means of communication is unpersuasive.
There is no constitutional requirement that the incremental cost of
sending massive quantities of unsolicited advertisements must be
borne by the recipients. The legal concept in Lloyd that private
citizens are entitled to enforce laws of trespass against would-be
communicators is applicable to this case.
Defendants assert that CompuServe has assumed the role of
postmaster, to whom all of the strictures of the First Amendment
apply, and that to allow it to enjoy a legally protected interest
in its computer equipment in this context is to license a form of
censorship which violates the First Amendment. However, such an
assertion must be accompanied by a showing that CompuServe is a
state actor. An earlier mentioned, defendants have neither
specifically argued this point nor provided any evidence to support
it. CompuServe is entitled to restrict access to its private
property.
"The First and Fourteenth Amendments have never been treated
as absolutes. Freedom of speech or press does not mean that one
can talk or distribute where, when and how one chooses. Breard
v. City of Alexandria, 341 U.S. 622, 642 (1951) (upholding
local ordinances banning commercial solicitations over First
Amendment objections) (footnote omitted). In Rowan v. U.S. Post
Office Dept., 397 U.S. 728 (1970) the United States Supreme
Court held that the First Amendment did not forbid federal
legislation that allowed addressees to remove themselves from
mailing lists and stop all future mailings. The Court stated that
the "mailer's right to communicate must stop at the mailbox of an
unreceptive addressee. . . . [t]o hold less would be
to license a form of trespass[.]" Id. at 736-37.
In Tillman v. Distribution Sys. of America, Inc., 648
N.Y.S.2d 630 (N.Y.A.D. 1996) the plaintiff complained that the
defendant continued to throw newspapers on his property after being
warned not to do so. The court held that the defendant newspaper
distributor had no First Amendment right to continue to throw
newspapers onto the property of the plaintiff. After discussing
the Supreme Court cases of Rowan and Breard,
supra, the court pointed out that:
The most critical and fundamental distinction between the
cases cited above, on the one hand, and the present case, on
the other, is based on the fact that here we are not dealing
with a government agency which seeks to preempt in some way
the ability of a publisher to contact a potential reader;
rather, we are dealing with a reader who is familiar with a
publisher's product, and who is attempting to prevent the
unwanted dumping of this product on his property. None of the
cases cited by the defendants stands for the proposition that
the Free Speech Clause prohibits such a landowner from
resorting to his common-law remedies in order to prevent such
unwanted dumping. There is, in our view, nothing in either
the Federal or State Constitutions which requires a landowner
to tolerate a trespass whenever the trespasser is a speaker,
or the distributor of written speech, who is unsatisfied with
the fora which may be available on public property, and who
thus attempts to carry his message to private property against
the will of the owner.
Id. at 635. The court concluded, relying on Lloyd,
supra, that the property rights of the private owner could
not be overwhelmed by the First Amendment. Id. at 636.
In the present case, plaintiff is physically the recipient of
the defendants' messages and is the owner of the property upon
which the transgression is occurring. As has been discussed,
plaintiff is not a government agency or state actor which seeks to
preempt defendants' ability to communicate but is instead a private
actor trying to tailor the nuances of its service to provide the
maximum utility to its customers.
Defendants' intentional use of plaintiff's proprietary
computer equipment exceeds plaintiff's consent and, indeed,
continued after repeated demands that defendants cease. Such use
is an actionable trespass to plaintiff's chattel. The First
Amendment to the United States Constitution provides no defense for
such conduct.
Plaintiff has demonstrated a likelihood of success on the
merits which is sufficient to warrant the issuance of the
preliminary injunction it has requested.
As already discussed at some length, plaintiff has submitted
affidavits supporting its contention that it will suffer
irreparable harm without the grant of the preliminary injunction.
As an initial matter, it is important to point out that the Court
may accept affidavits as evidence of irreparable harm. Wounded
Knee Legal Defense/Offense Committee v. Federal Bureau of
Investigation, 507 F.2d 1281, 1287 (8th Cir. 1984); see
generally Wright, Miller & Kane, Federal Practice and
Procedure §2949, at 218-220 (West 1995). Defendants
suggest that there are other reasons why CompuServe subscribers
terminate their accounts, but do not offer any evidence which
contradicts plaintiff's affidavits.
Normally, a preliminary injunction in not appropriate where an
ultimate award of monetary damages will suffice. Montgomery v.
Carr, 848 F. Supp. 770 (S.D. Ohio 1993). However, money
damages are only adequate if they can be reasonably computed and
collected. Plaintiff has demonstrated that defendants' intrusions
into their computer systems harm plaintiff's business reputation
and goodwill. This is the sort of injury that warrants the
issuance of a preliminary injunction because the actual loss is
impossible to compute. Basicomputer Corp. v. Scott, 973
F.2d 507 (6th Cir. 1992); Economou v. Physician's Weight Loss
Centers of America, 756 F. Supp. 1024 (N.D. Ohio 1991).
Plaintiff has shown that it will suffer irreparable harm
without the grant of the preliminary injunction.
It is improbable that granting the injunction will cause
substantial harm to defendant. Even with the grant of this
injunction, defendants are free to disseminate their advertisements
in other ways not constituting trespass to plaintiff's computer
equipment. Further, defendants may continue to send electronic
mail messages to the tens of millions of Internet users who are not
connected through CompuServe's computer systems.
Finally, the public interest is advanced by the Court's
protection of the common law rights of individuals and entities to
their personal property. Defendants raise First Amendment concerns
and argue that an injunction will adversely impact the public
interest. High volumes of junk e-mail devour computer and storage
capacity, slow down data transfer between computers over the
Internet by congesting the electronic paths through which the
messages travel, and cause recipients to spend time and money
wading through messages that they do not want. It is ironic that if
defendants were to prevail on their First Amendment arguments, the
viability of electronic mail as an effective means communication
for the rest of society would be put at risk. In light of the
foregoing discussion, those arguments are without merit. Further,
those subscribing to CompuServe are not injured by the issuance of
this injunction. Plaintiff has made a business decision to forbid
Cyber Promotions and Mr. Wallace from using its computers to
transmit messages to CompuServe subscribers. If CompuServe
subscribers are unhappy with that decision, then they may make that
known, perhaps by terminating their accounts and transferring to an
Internet service provider which accepts unsolicited e-mail
advertisements. That is a business risk which plaintiff had
assumed.
Having considered the relevant factors, this Court concludes
that the preliminary injunction that plaintiff requests is
appropriate.
V.
Based on the foregoing, plaintiff's motion for a preliminary
injunction is GRANTED. The temporary restraining order filed on
October 24, 1996 by this Court is hereby extended in duration until
final judgment is entered in this case. Further, defendants Cyber
Promotions, Inc. and its president Sanford Wallace are enjoined
from sending any unsolicited advertisements to any electronic mail
address maintained by plaintiff CompuServe during the pendency of
this action.
IT IS SO ORDERED.
| |
JAMES L. GRAHAM
United States District Judge
|
DATE: February 3, 1997
1 This term is derived from a skit performed
on the British television show Monty Python's Flying
Circus, in which the word "spam" is repeated to the point
of absurdity in a restaurant menu.
2 That consent is apparently subject to
express limitations. See Kolehmainen Dec. at ¶2 and
discussion infra.
