'Spam King' to pay $6 million to MySpace
Last Saturday, an arbitrator ordered Scott Richter, the president of online advertising and direct marketing firm Media Breakaway, to pay a stiff penalty to MySpace, including $1.2 million in legal fees.
The settlement is the second major one for Richter, who previously settled with Microsoft in August 2005 for $7 million. He was once considered one of the most prolific spammers, sending out over 100 million messages per day.
MySpace launched its own suit against Richter last January, accusing him of sending unsolicited messages and phishing attempts to the company's users. In some cases, "hacked" profiles were being used to send out these spam messages.
As part of the deal, Media Breakaway will be responsible for paying the fine, and its employees will be banned from using MySpace. But while the monetary judgment is but 5% of the $120 million MySpace had initially sought, the arbitrator found that it would not be fair to hold Media Breakaway directly responsible for the actions of its affiliates, who used its platform for distribution purposes.
While Richter himself has been said to have given up on spamming, his company owns Dynamic Dolphin, which is listed as one of the top ten registrars for spam domains by anti-spam group KnujOn.
Court documents show that Media Breakaway had made some effort to attempt to adhere to anti-spam laws. Anti-phishing agreements were signed, although the firm's clients either ignored them or didn't realize they existed.
In a statement, Scott's father and Media Breakaway counsel Steven Richter said that he respected the ruling, and noted the arbitrator's acknowledgment that Media Breakaway was taking steps to follow the law. "We firmly believe that positive changes in the online marketing industry come about through cross-industry cooperation and not through costly litigation," he added.
Last weekend's arbitrator's decision follows another where a US District Court awarded MySpace $230 million as a result of the spamming of two individuals, Sanford Wallace and Walter Rines. The company said it was the continuation of a "war" on spam and phishing across its site.