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Lawyer Sues Linhardt, e360, Claiming Deceptive E-mails
Dec 4, 2007 3:46 PM , By Ken Magill
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An Ohio lawyer is suing e-mail marketer e360 Insight and its president, Dave Linhardt, claiming e360 sent him hundreds of e-mails that constituted deceptive advertising.

The attorney, John “Jack” Ferron, is also in the midst of a number of other legal tussles surrounding commercial e-mail, including one with one of e-mail’s most famous litigants, Scott Richter.

Ferron says he’s got nothing against online advertising, but that he wants some e-mailers to clean up their acts. Linhardt says otherwise, and adds he believes other marketers may end up in Ferron’s crosshairs.

In a complaint filed on Nov. 11, Ferron, alleged he received e-mail messages from e360 Insight offering designer goods at deeply discounted prices, but that the goods were forgeries.

The complaint also alleges e360 sent the company e-mails that violated Ohio’s Consumer Sales Practices act by claiming the recipient was entitled to something for free without clearly laying out the conditions of the offer.

Ferron is asking the court for $200 per violation, which could amount to $160,000 or more, he said.

He added he received about 900 e-mail messages from e360, 600 to 700 of which contained what he regards as deceptive “free” offers.

“In point of fact you have to click on the e-mail and it takes you to a Web site that educates you that you must buy certain things before you receive the free gift,” he said. “That is a violation not only of Ohio’s consumer laws, but also the FTC’s guidelines, as well.”

He added that about 100 of the e-mails from e360 offered cheap imitation goods.

“Our courts can award $200 per violation, so if there are multiple violations in a given message, it could be a higher award than just $200 per e-mail,” he said.

Ferron said he tried to settle with Linhardt, but that Linhardt declined, saying he has no money.

Linhardt has been in a long legal battle with anti-spam outfit Spamhaus. Linhardt won an $11.7 million default judgment against Spamhaues in 2006 when representatives of the anti-spam blacklister failed to show up to defend themselves in court.

Spamhaus appealed the judgment. A federal appeals court vacated it in September, and sent it back to district court to recalculate damages.

Ferron said Linhardt offered him a piece of the Spamhaus settlement when and if it comes through, but Ferron declined.

For his part, Linhardt has moved to have Ferron’s suit against him dismissed, claiming the Ohio court lacks jurisdiction.

This is the latest in a series of lawsuits Ferron has brought against e-mailers who he claims have sent him deceptive e-mails, some of which he has settled, others of which are pending.

In one of the more high-profile examples, Ferron is in the midst of settlement talks with well-known e-mailer Scott Richter as a result of a suit Ferron brought against Richter’s firm Breakaway Media and online marketing firm ValueClick.

Richter has been involved in several high-profile lawsuits concerning his advertising practices. Online social networking site MySpace sued him in January, claiming Richter sent billions of unsolicited “bulletins” to its members.

ValueClick settled with Ferron for an undisclosed sum last month, Ferron said, adding he has nothing against e-mail marketing.

“I don’t have any problem with online advertising or e-marketing as long as they comply with Can Spam, but I want to especially encourage e-marketers to make sure their advertisements aren’t deceptive,” he said. “In late 2005 and 2006 I noticed a very large number of the types of e-mails that said: ‘Congratulations on your 42-inch plasma TV. Click here for details,’ and you would click and have to participate in marketing surveys and you would find out you have to buy 10 different things to qualify and the last couple of things are big-ticket items.”

He added: “These things are anything but free.”

However, Linhardt claims e-mail related lawsuits are a business model for Ferron and that other commercial e-mailers should beware of him lest they end up in his crosshairs.

“In my opinion, Mr. Ferron is simply trying to extort money from legitimate businesses as a way to fund his firm,” said Linhardt in an e-mail exchange with this newsletter. “Mr. Ferron’s tactic is to sign up under different e-mails and aliases on Web sites known to be engaged in opt-in marketing.”

Linhardt added: “Even if you block his connection, he goes to an Internet cafe to sign up from a different IP. He then lets hundreds of e-mails accumulate in his accounts for several years. He pays an expert to analyze his e-mail files and then sues every company he can identify.

“I believe we were named primarily due to the visibility in the Spamhaus case,” Linhardt added. “Since his settlement demand was unreasonable, we have no choice but to defend ourselves in the case. Not many people know about him yet. Every legitimate e-mailer needs to take notice since this could happen to any company who has a Web site.”



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