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IN THE UNITES STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF OHIO
EASTERN DIVISION
CompuServe Incorporated,
Plaintiff,
vs. Case No. C2-96-1070
JUDGE GRAHAM
Cyber Promotions, Inc. and
Sanford Wallace,
Defendants.
__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 Hard y, __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
Footnote *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.
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 chattel s 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 th is 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).
Footnote *2: That consent is apparently subject to express
limitations. See Kolehmainen Dec. at ¶2 and
discussion __infra_.
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. 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 d o. 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 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 t o 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.
[SIGNED]
JAMES L. GRAHAM
United States District Judge
DATE: February 3, 1997
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