Facebook Sues MaxBounty, Claims All Messages on Facebook Are Regulated by CAN-SPAM
Facebook went after the network, not just the spammers. A federal judge agreed that a wall post can be email.
On October 19, 2010, Facebook filed suit in federal court in San Jose against MaxBounty, an Ottawa-based CPA affiliate network. It was the first time Facebook had sued an affiliate network over this kind of scheme, and that was the news. Suing spammers is routine. Suing the network that pays them is a strategy.
What Facebook alleged
Facebook called MaxBounty the "mastermind" of a scheme in which affiliates built fake Facebook Pages promising free gift cards or iPads. Users were told to become fans and invite all their friends, then sent through a MaxBounty domain to paid "sponsor offers." The prize never came. Facebook said MaxBounty coached its affiliates and paid them incentives. The claims were under CAN-SPAM and the Computer Fraud and Abuse Act. MaxBounty did not comment at the time. Facebook filed two more suits the same day against individuals.
The ruling that mattered
On March 28, 2011, Judge Jeremy Fogel denied MaxBounty's motion to dismiss. He held that commercial posts to users' walls, news feeds and home pages are "electronic mail messages" under CAN-SPAM, leaning on congressional intent and earlier MySpace rulings. Critics, writing on Eric Goldman's legal blog, warned the logic could reach blog comments and tweets. The parties resolved the case in November 2011; the terms were not public.
How it aged
The case is still cited for the idea that social messages can fall under anti-spam law. More important for this industry, it was an early, clear example of a platform holding a network responsible for its affiliates' conduct. That theory now sits underneath every compliance program in lead generation, whether the networks admit it or not.
This page rebuilds an October 2010 IndustryPace post whose original text is not available. Facts come from PCWorld's coverage of the filing, the March 2011 order as analyzed on Eric Goldman's Technology and Marketing Law Blog, and Law360. Allegations in the complaint were not adjudicated on the merits. The author co-founded LeadsCon; Troutman Amin, a TCPA and marketing-law firm, underwrites some of the author's ADOTAT work.