Spammer Pays Microsoft $7m To Settle Lawsuit

by Glen Shapiro, LawAndTax-News.com, New York

12 August 2005

Microsoft Corp announced on Tuesday that it has reached a $7 million settlement agreement with Scott Richter over spam sent by his company, OptInRealBig.com.

As part of its effort to fight spam, Microsoft filed a lawsuit against Mr. Richter and his company in December 2003, when he was ranked one of the top spammers in the world. In July 2005, Mr. Richter was removed from the Register of Known Spam Operators maintained by the Spamhaus Project, a leading anti-spam and consumer advocacy organization.

The settlement is conditional upon dismissal of the bankruptcy cases filed in March by Mr. Richter and OptInRealBig at the U.S. Bankruptcy Court in Denver.

According to Microsoft:

"As part of the settlement, Mr. Richter and his company agreed to pay $7 million to Microsoft. The settlement also stipulates that Mr. Richter, his company and his affiliates will continue to comply fully with all federal and state anti-spam laws, including the U.S. CAN-SPAM (Controlling the Assault of Non-Solicited Pornography and Marketing) Act, and will not send spam to any person who has not confirmed a willingness to receive the e-mail."

"Microsoft will direct $5 million of the settlement to expand the company’s Internet safety partnerships with governments and law enforcement worldwide through technical training, investigative and forensic assistance, and the development of new technology tools. The company has pledged an additional $1 million to provide many community centers in New York state broader access to computers for underprivileged children and adults through Microsoft’s Unlimited Potential Program."

Commenting on the settlement, Richter announced that:

“In response to Microsoft’s and the New York Attorney General’s lawsuits, we made significant changes to OptInRealBig.com’s e-mailing practices and have paid a heavy price." He continued: “I am committed to sending e-mail only to those who have requested it and to complying fully with all federal and state anti-spam laws.”

Microsoft’s senior vice president and general counsel, Brad Smith, meanwhile, expressed satisfaction regarding the impact of Microsoft’s litigation.

“When we filed this action, Mr. Richter was listed as one of the top three spammers in the world,” Mr. Smith announced. “Because of this litigation, Mr. Richter has fundamentally changed his practices and forfeited ill-gotten gains. Microsoft looks forward to a permanent change in Mr. Richter’s practices.”

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