Calif. Top Court Spurns Intel in Spam Case

UPDATE: Intel loses the latest round in its protracted legal battle to sue a disgruntled employee for spamming the company.

In a blow for chipmaker Intel , the California Supreme Court Monday found that senders of spam e-mails cannot be sued under state law forbidding property trespass.

The 4 to 3 ruling reversed a lower court injunction preventing former Intel engineer Ken Hamidi from sending e-mails critical of Intel to thousands of its employees. Santa Clara, Calif.'s Intel successfully argued the e-mails had trespassed on its private network and had harmed the company by reducing worker productivity.

The court said it overturned the ruling because Intel could not prove that its computer system had been damaged as a result of the e-mails, meaning there was no trespass.

"After reviewing the decisions analyzing unauthorized electronic contact with computer systems as potential trespasses to chattels, we conclude that under California law the tort does not encompass, and should not be extended to encompass, an electronic communication that neither damages the recipient computer system nor impairs its functioning," the court found in its ruling.

The ruling further said Hamidi's e-mails did not affect employees "any more than the personal distress caused by reading an unpleasant letter would be an injury to the recipient's mailbox, or the loss of privacy caused by an intrusive telephone call would be an injury to the recipient's telephone equipment."

While Monday's finding may be a win for First Amendment rights proponents, it may be seen as a blow to many of the agencies or companies which have recently thrown the gauntlet down on spam, including Microsoft and the U.S. government, which passed the Can Spam Act two weeks ago.

The outcry against spam has risen to a piercing level, with Microsoft's own Bill Gates issuing a decree against the annoying influx of unsolicited e-mail. Ironically, a new California law kicked into gear Tuesday that allows people to sue spammers.

Intel spokesman Chuck Mulloy said Intel was disappointed by the decision, but noted that the company's lawyers are studying the ruling to see if another angle could be worked to keep Hamidi from continuing his spamming campaign, which he indicated he would do.

"The case wasn't made at the lower court that the e-mails caused damage to our computer system," Mulloy told internetnews.com. "It's equivalent to the notion that if I walk across your lawn, it's not considered trespass, but if I walk across your lawn and kick a sprinkler and break it, it's a tresspass."

Mulloy said the company's legal team is pursuing possible defamation angles, or "interference with prospective economic value." He did not rule out a return to the failed trespass angle provided Intel could come up with evidence to support such a claim.

Marshall B. Babson, a law partner in the Washington office of Jones Day and a former member of the National Labor Relations Board who has written widely on email in the workplace, was also disappointed with the ruling.

"The holding of the court is an unfortunate one for employers," Babson said. "Basically, the court found that the thousands of email sent by this former, disgruntled employee to Intel employees did not trespass on Intel's email system because the system was able to handle the load and was returned to Intel in an unharmed state. Such reasoning is akin to 'borrowing' without permission someone's possession, and not calling it trespass to chattels because it was returned promptly, in good working order to the owner, and did not cause any discernible adverse impact to the business."

The Intel case ignited in 1998 after Hamidi, who was fired in 1995, sent six e-mail messages over two years to thousands of Intel employees worldwide discussing the company's labor practices. Intel claimed the employees who read the e-mails were upset or lost productivity, and the company eventually filed a lawsuit against Hamidi. A Sacramento Superior court issued a summary judgment ordering him to stop sending the e-mails in 2001. Hamidi appealed, a divided appeals court affirmed the lower court decision, and he appealed to the California Supreme Court.

The Electronic Frontier Foundation (EFF), which had filed an amicus brief in the Intel v. Hamidi case arguing that the lower court distorted the "trespass to chattels" doctrine when applying it to the Internet, was pleased with the decision.

"The Hamidi case establishes that even if you send electronic communications after recipients tell you not to, you are likely protected from spurious trespass lawsuits as long as there is no harm to computer systems as a direct result of the electronic communications," added EFF Legal Director Cindy Cohn. "Recipients of unwanted email may pursue legal claims other than trespass in certain circumstances and can pursue even trespass claims in the event of damage to their computer systems."

Mulloy said Intel was gratified that the court ignored the claims that the company was infringing on Hamidi's First Amendment rights, noting that Intel only wanted to protect its employess and its proprietary e-mail system.

The Supreme Court's ruling in Intel vs. Hamidi may be read here.






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