Websites so smart, they're magic!

Written Testimony Draft for
The Forum for Responsible and Ethical E-mail
by Mickey Chandler, Co-Founder, President, and Legislative Liaison⁽¹⁾
before the Texas Senate Committee on Business & Economic Development

I would like to begin by thanking the Chair and members of the Committee for your request that I speak here today on behalf of the Forum for Responsible and Ethical E-mail, also known as FREE, regarding Senate Bill 106.

FREE is an unincorporated, all-volunteer group of owners and operators of Internet-based businesses, Internet service providers (ISPs), technology professionals, and consumer activists. We are the newest Internet advocacy group dealing with electronic mail issues in the United States at just under one year old. We formed our organization to act as another voice to advocate a legislative solution to the problem of "junk e-mail,"⁽²⁾ because it has become clear to us that technical and self-regulatory solutions are ineffective at best and a farce at worst. We are a national pro-active organization which has engaged in an on-site protest of a junk electronic mailer that attracted national media coverage.

The Forum represents a wide range of Internet users and Internet-based businesses. Our Board of Directors includes longtime Internet users, a paralegal, the owner of a small, start-up Internet Service Provider, the computer systems administrator for a newspaper, and the moderator of a USENET newsgroup. Our Board is advised by the Abuse Desk supervisors of two of America's fastest growing mid-sized Internet Service Providers, Erols Internet Services, and Mindspring Enterprises, plus the Abuse Desk supervisors for both the Microsoft Corporation and MSN Hotmail. What we all have in common is our love of the Internet. Some of us make our living on-line, while others merely see a problem that demands a legislative solution. We welcome the presence of businesses on-line and we want to do business on-line. We are not willing, however, to subsidize industries that choose to do their business in cyberspace.

The Nature of the Internet

Unlike most other communications media previously created, the cooperative arrangements upon which the Internet was created cause each participant in a transaction, whether the recipient or not, to pay for part of the infrastructure. This means that once an electronic mail is sent, whether it is an advertisement or an e-mail letter to a constituent back home, the mass of costs for relaying, transmitting, receiving, storing, and downloading the message are borne by any number of people, except the sender.

How is this accomplished? The currency of the Internet is the exchange of information between computer systems in the form of files. Each of these files consumes part of the transaction space (or bandwidth) available at any one point in time. An Internet Service Provider pays for the combined amount of incoming and outgoing bandwidth by the month. That bandwidth may be consumed by either requests for files, for World Wide Web pages, or for transmission, relay, or receipt of files, as with electronic mail. Further, with electronic mail, the service provider must furnish storage space for the files until the end user can either download them to a computer at home or delete them from the storage space. This is a vital difference between Internet communications and most other formats. To date, only two other forms of communications utilize an economy such that a shift in costs is incurred: the facsimile and the cellular telephone.

The Problem

As we just noted, the Internet Service Provider must pay for the transmission, relaying, receiving, storing, and downloading of electronic mail. Further, they do not incur those costs merely in bandwidth, but in computer processing power, server storage space, and personnel to ensure that the system works as it should.

This arrangement is fine for normal traffic over the Internet. However, when we add UBE into the equation, we see a spike in the costs for all three. The technology news media reports with alarming frequency system crashes and network outages caused by UBE attacks. UBE has knocked out systems belonging to major ISPs such as AT&T,⁽³⁾ @Home,⁽⁴⁾ GTE,⁽⁵⁾ Netcom,⁽⁶⁾ Pacific Bell,⁽⁷⁾ and literally hundreds of smaller ISPs serving rural communities across the state and the nation. Each of these attacks necessitates the purchase of better servers, faster computer processors, additional employees to man abuse desks, or some combination of these.

Technology shows little promise of solving the problem, and hauling junk mailers into court on cutting-edge theories in cyber-law is not a reasonable or affordable answer.⁽⁸⁾ Small ISPs exist on notoriously tiny profit margins. Seemingly little things, such as the number of milliseconds it takes for a computer to process a piece of electronic mail, become massive problems when facing the demands of Internet services. For an Internet Service Provider, the processing capacity of their mail servers is a precious commodity and when their systems are tied up processing UBE, it creates a drag on all of the services they provide to their customers.⁽⁹⁾ Upgrading those systems or adding personnel to work on these problems create additional expenses which they must pass to the consumer if the provider wishes to remain in business.

To display the immensity of the problem presented by UBE, FREE registered the commonly forged⁽¹⁰⁾ domain name of "ybecker.net"⁽¹¹⁾ when we were established. Within the first thirty days, we received more than one thousand complaints, abuse reports, threats of legal action, and notices that traffic to and from our domain would no longer be accepted or processed.⁽¹²⁾ This represents an average of approximately thirty-three reports per day. However, this was the fruit of only three mailings by one Canadian electronic mailer. He quickly ended the forgery of our domain after discovering that our response to abuse reports sent to us included an analysis of the routing information of a typical run for him, along with instructions on how to report this type of abuse more effectively.⁽¹³⁾ These numbers have added impact because the use of the "Stealth Mailer" computer program decreased briefly after we announced we registered the domain while the author enabled a software fix that changed the forgery from our newly registered domain to other forms.

This problem is not only displayed by the impact upon ISPs, but also in its impact upon small businesses attempting to engage in legitimate commerce on the Internet. A prime example occurred right here in Austin. In early 1997, a San Diego, California, college student named Craig Nowak sent out an unsolicited advertisement for a scholarship service he was trying to run from his dormitory room called "CN Enterprises." However, he had forged the electronic mail's headers to include "flowers.com". Because he did not check with the domain registry service, InterNIC, he did not know that "flowers.com" was a registered domain that belonged to Tracy LaQuey Parker and her husband, Patrick, of Austin. Because of his advertisement, Mrs. Parker saw a run of abuse reports, angry electronic mail from consumers vowing never to do business with them, and reports of undeliverable mail that was so overwhelming that it overpowered the ability of their servers to cope. In short, Mr. Nowak caused them to suffer from the Internet equivalent of a flood the likes of which have not been seen since the time of Noah. Other groups which have suffered the same fate include the owners of joes.com,⁽¹⁴⁾ marketing.com, and public.com.

If FREE's experience with domain forgery is any indication, each of these companies were immediately "black holed"⁽¹⁵⁾ by other providers such that for all intents and purposes they no longer existed to that provider or its customers. All for something they did not do and did not condone. This type of damage is not easy to undo and the result is nothing less, we think, than tortious business interference by the mailer for creating the conditions that result in the targeted domain's isolation from the remainder of the Internet. In addition, the targeted business has already suffered from what can only be termed "theft of resources" by unwillingly allowing the mailer to use server space, processing cycles, and labor without permission or compensation. While FREE's participation in this has been voluntary and for educational purposes, this type of punishment is devastating to an Internet-based business whose only storefront may be its Internet pages.

Unsolicited Broadcast Electronic Mail
Stifles the Exercise of Free Expression

With UBE already the number one complaint of most Internet users, some consumers have deserted many public discussion forums for fear that their electronic mail addresses will be "harvested" and added to a junk mailer's lists. Citizens will not put their electronic mail addresses on their "home pages" for fear they likewise will be "harvested." Customers are afraid to give their electronic mail addresses out in legitimate commerce for fear of being added to and traded among thousands of mailing lists.

For members of some online services, such as America Online, the only way to avoid getting junk e-mail is to do nothing at all. One of FREE's members got involved in the fight against UBE when his mother-in-law, a "straight laced, fifty-something, conservative, Republican," visited a real-time chat forum on America Online devoted to knitting. By the time she left that forum, her mailbox was full of solicitations for a variety of items, including one with the subject line of: "Hot Lesbian Sex Just Waiting for YOU!!!"

Sadly, she has never again returned because she feels that keeping her sensibilities intact is more important to her than talking with others who enjoy her hobby. In point of fact, an article on page 13 of the June 3, 1998 edition of the Christian Science Monitor, suggests that the best way to prevent junk e-mail from taking over your mailbox is to "keep a low profile" and not participate in discussion groups, such as that knitting forum.

When people are basically told "do nothing and you won't get hurt," something is very wrong with calling the Internet "the First Amendment's greatest stronghold." More importantly, it should tell us that the very fundamental freedom to speak freely and openly has been, in a very de facto manner, taken from "Everyman" who now finds himself placed in virtual state of siege.

Unsolicited Broadcast Electronic Mail Shifts
Tremendous Costs Onto Recipients

Unlike virtually every other communications medium, the recipients pay most of the electronic mail's costs - not the sender. As already discussed, this grows out of the cooperative arrangements upon which the Internet was created, where each participant, whether the sender, the recipient, and everyone in between, pays for their portion of the infrastructure utilized in a transaction.

Even if the problem were limited to just one or two messages, per person, per day, forcing a recipient to pay for receiving advertising would be unacceptable. However, we are not talking about just a few messages.

As I already noted, FREE receives a great deal of junk mail as complaints and abuse reports; however, we also receive a great deal of junk mail directed toward FREE and its board members. In the past year alone, I have received more than two thousand four hundred such messages with more than one hundred sent to my Forum account. One might think that a mailer would find sending UBE to a person dedicated to ending the practice both counter-productive and counter-intuitive, but the economics of UBE create a strong disincentive to send such mail in a carefully targeted manner. Given that the transaction cost of one hundred outgoing messages is the same as one million, a mailer has every incentive to send his message to as many e-mail addresses as possible and every second used to cull a list is a second lost in mailing. With a minuscule investment, even if only one out of every ten thousand recipients buys the mailer's miracle cure or multilevel marketing scheme, not only will he have recovered his tiny investment, he may have turned a handsome profit.

The problem with UBE stems from the realization by unscrupulous mass marketers that they can force their messages, even if unwanted, unwelcome, and offensive, on millions of consumers, with just the touch of a button, and at virtually no cost to themselves. According to Sanford Wallace, perhaps the best-known former sender and facilitator of UBE, the bar to entry is less than $500.00. Our colleagues at the Coalition Against Unsolicited Commercial E-mail places that hurdle at around $100.00.

While the costs are small for the mailer, we cannot say the same for the people who have to transport, process, store, and retrieve that electronic mail. Millions of Internet users, businesses and consumers alike, pay for their access to the Internet in increments of time, or even bandwidth. Many more, particularly those in rural communities or those who travel extensively, must make toll calls to obtain a connection. Foreign nationals in some countries must pay not only a toll for the call to get to their mail, but also by the bandwidth consumed for each piece of mail sent or received. For these individuals, each unsolicited message they receive is like a telemarketer's call to their cellular phone or made "collect" - they pay to receive messages they did not ask for and inevitably do not want. Even those consumers who pay a "flat rate" and receive no UBE of their own subsidize the UBE sent to other customers of the same service provider simply because the provider must pass the costs for additional servers, faster processors, and additional support staff onto someone. Estimates of the "hard" costs to the "flat rate" user stand at about ten percent of the monthly bill.⁽¹⁶⁾

It also presents a problem for those who do not immediately review their e-mail. When these individuals do check their electronic mailboxes, they find they must wade through scores of unsolicited advertising messages to find legitimate electronic mail. During that time, their company or service provider has been forced to store, without reimbursement, that tremendous volume of mail until the user can retrieve it. Further, most service providers maintain hard caps on the amount of electronic mail storage space a customer can use. When this amount of space is reached, any additional mail is returned to its sender. This means that legitimate communication can be, and, indeed, has been, rejected because the recipient's electronic mail box is full of UBE.

UBE forces Internet users to become a captive audience for whatever advertising message anyone wishes to send them, at any time, any number of times. Beyond these "hard costs," there are also many non-monetary costs of UBE. Unlike direct mail from the post office, junk e-mail arrives throughout the day at home and at work, and there is no effective technical means of blocking it.⁽¹⁷⁾ UBE in the workplace interrupts employees who must wade through pornographic ads, "get rich quick" schemes, and "please buy my [fill in the blank]" pleas to find work-related electronic mail.

According to estimates from a Corel Corporation study in the United Kingdom and Ireland, the cost to businesses in those countries has been placed at more than eight billion dollars per year, in time wasted alone.⁽¹⁸⁾ This is especially significant in light of the European Union's personal privacy rules which have greater restrictions on the collection, sell, and use of personal information, including name and electronic mail address. In states that are "high-tech friendly," such as Texas, the hidden costs to businesses and consumers associated with UBE are apt to be equally staggering. Parents and their children often have no choice but to accept, pay for, and dispose of these unwanted and sometimes highly offensive or even pornographic messages. Major UBE campaigns can also knock out entire Internet systems, resulting in lost data, lost business, lost opportunities, and lost productivity. When confronted with the above, the hue and cry of the bulk mailer is to "just hit delete" because "it isn't illegal." Unfortunately, "just hitting delete" does nothing to rectify either the hard or the soft costs that have already been shifted onto the unwilling for the undesired.

The Economics of UBE Encourage Massive Abuse

When turned into an advertising medium, the skewed economics of electronic mail turn traditional notions of advertising on their head. In virtually no other advertising medium does the advertiser get to force the recipient to bear more costs than they do. With television, print ads in newspapers or magazines, or advertisements sent in the U.S. Mail, the sender incurs significant initial costs and thus finds it desirable to target advertising carefully because each additional ad bears an incremental cost. However, in the world of UBE marketing, it costs no more to send the thousandth, the millionth, or the one billionth electronic mail as it does the first. Thus, there is every incentive for marketers to broadcast their advertisements as widely and indiscriminately as possible.⁽¹⁹⁾ No other business would consider sending ads for a Chinese restaurant in Boston to people living in Austin. But it happens under the skewed economics of junk e-mail.

Not only is there no incentive to target the mailing lists carefully, there is not even an incentive to reduce duplication. So today, many people, myself included, regularly receive multiple copies of the same advertisement. When advertisers pay little to none of the costs involved, there is no incentive for them to be careful; indeed, time spent on editing a mailing list is seen as profit lost. Further, many of these e-mailers broadcast commissioned commercial e-mails on a "piece received" basis. These same e-mailers also attempt to hide or disguise the origin, redirect error messages, and avoid abuse reports by subterfuge. By so doing, they have removed all accountability from the system.

The Solution

Taking as true that junk e-mailers have removed all accountability from the system, what is the proper solution to the problem placed before us? Governments have remedied the marketplace failure and made responsible behavior more cost effective by enacting substantial fines and penalties as a matter of public policy. A perfect case in point is the federal statute that outlawed the sending of unsolicited advertisements via a facsimile machine.

E-mail is increasingly becoming a critical business tool in much the same way as the fax machine became an indispensable tool during the late 1980s. As ever more businesses began to use fax machines, marketers decided that they could fax their advertisements. For anyone in a busy office in the late 1980s and early 1990s, you will undoubtedly remember the piles of office supply catalogs and business printing ads that came pouring out of your fax machine. On far too many occasions, you had to shut off the fax machine in mid-advertisement so your business colleagues could try to send their fax before the advertiser could redial.

When looking for a legislative solution to the problem of UBE, we found that the fax statute, 47 U.S.C. 227, has been tremendously successful at curtailing the problem of junk faxes and points the way to a real and meaningful solution to the problem of junk e-mail. By combining this existing statute with the Deceptive Trade Practices Act (Section 17.41, et seq., Bus.&Comm. Code), Section 35.47, Business & Commerce Code, and expanding the language to place a blanket ban on cost-shifted advertising, we feel that we have created a viable law that recognizes the both right of the advertiser to advertise and of the recipient to expect that they will incur no costs in the receipt of an advertisement.

The Current State of the Law in Texas

Currently, Section 35.47, Business & Commerce Code, seeks to prevent both junk facsimiles and telemarketing calls to cellular phones by making these forms of cost-shifted advertising Class C misdemeanors. To date, there have been no appellate opinions reported on this law.

S.B. 106 would repeal this law and replace it with a private right of action. Thus, if a person enjoys or desires to receive any form of cost-shifted advertisement they may continue to do so. However, if someone wants to receive no advertising which shifts its costs for delivery or receipt, a means is put in place to effect a remedy. Unlike the current state of the law, that remedy will not include a criminal record for the advertiser unless improper routing information is used to misdirect abuse reports or collection attempts under the law. Further, this would, in conjunction with the existing federal anti-junk fax law, present recipients of unsolicited facsimile advertisements with a choice of law to apply.

S.B. 106 and the Constitution

Historically, laws that require a person to "opt-in" to an advertising program have been met with challenges under the First Amendment to the Federal Constitution. However, as the United States Supreme Court noted in Rowan v. U.S. Post Office:

Nothing in the Constitution compels us to listen to or view any unwanted communication, whatever its merit; we see no basis for according the printed word or pictures a different or more preferred status because they are sent by mail. The ancient concept that "a man's home is his castle" into which "not even the king may enter" has lost none of its vitality, and none of the recognized exceptions includes any right to communicate offensively with another. . . .

We therefore categorically reject the argument that a vendor has a right under the Constitution or otherwise to send unwanted material into the home of another. If this prohibition operates to impede the flow of even valid ideas, the answer is that no one has a right to press even "good" ideas on an unwilling recipient. That we are often "captives" outside the sanctuary of the home and subject to objectionable speech and other sound does not mean we must be captives everywhere. The asserted right of a mailer, we repeat, stops at the outer boundary of every person's domain. ⁽²⁰⁾

Further, the Rowan court appreciated the fact that content decisions should be left to the recipient.⁽²¹⁾

In another Supreme Court case, Breard v. Alexandria,⁽²²⁾ the Court upheld the constitutionality of a local ordinance prohibiting door-to-door solicitation, stating that it is a misuse of the guarantees of free speech to force anyone to admit solicitors against their will. FREE feels that a logical extension of this doctrine includes the right of a recipient not only be to left alone when wanted, but to expect the advertiser to pay his or her own way. If, as the Supreme Court noted above, "[n]othing in the Constitution compels us to listen to or to view any unwanted communication; whatever its merit," then surely less compels us to be forced to pay for the unwanted communication.

In addition to the First Amendment to the federal constitution, the Texas Constitution provides, in relevant part: "Every person shall be at liberty to speak, write or publish his opinions on any subject, being responsible for the abuse of that privilege; and no law shall ever be passed curtailing the liberty of speech or of the press." Tex.Const., Art. I, 8. The courts of this state have held since 1991 that it is possible for the Texas Constitution to give greater rights than are granted under the federal constitution⁽²³⁾ and the United States Supreme Court has recognized this possibility since 1940.⁽²⁴⁾ This provision of the Texas Constitution gives a greater protection to "speech" than is found under the federal constitution.⁽²⁵⁾ However, even the Texas Bill of Rights recognizes that the liberty to speak, write or publish is a privilege and that a person abusing the privilege may be held accountable for that abuse.⁽²⁶⁾ It does not acknowledge, recognize, or, in my opinion, imagine the right of a person to publish at another's expense. This bill would impose a penalty for the abusiveness inherent in forcing others to pay the costs of a person's advertising especially when those forced to bear the brunt of the costs find the advertisements offensive and intrusive.

What This Bill Covers

As written, the expansive definition of "advertisement" would include commercial advertisements ranging from pyramid schemes to offers to sell a bicycle. It was specifically written to include Internet sites that send advertisements for "free porn" web sites. While these sites, which are often nothing more than lists of World Wide Web advertising banners, cost the viewer nothing to enter or view, the owner of the web site receives a set amount of money per banner exposure.

The bill also allows all parties incurring a cost to recover under the statute. This means that both the end user, who must pay the service provider for holding the advertisement, and the service provider, who must pay for the capital improvements necessary to receive and hold the advertisements, have independent causes of action.

The purpose of this bill is to allow the Legislature to only cover this issue once. As written, advertisements sent to a person via electronic mail, cellular, digital or other metered telephone line, or facsimile are prohibited. However, the open end of this language will also cover any new form of advertising invented in the future which allows what should be the advertiser's cost to be shifted onto another person without prior consent by simply expanding the definition of "telecommunication." In short, this bill protects people from being forced to view material that they do not want to view while preserving their right to see it upon request.⁽²⁷⁾

What This Bill Does Not Cover

As currently written, this language would not cover the bulk of modern advertising methodology. Specifically, television and radio advertisements; advertisements in newspapers, magazines, and circular flyers; bulk land mail advertising; and telemarketing calls to non-metered lines are not and should not be covered. In fact, except for telemarketing calls to non-metered lines, we can make a persuasive argument that these advertisements subsidize the media in which they are used by absorbing many costs which would otherwise be passed on to the consumer. Further, this bill does not prohibit advertising by billboard, yard sign, or even cardboard box top posted to a high line pole because they do not shift any costs for delivery or receipt to the viewer. Finally, any advertisement of a pure political or religious nature is not prohibited. So long as the advertisement does not attempt to bring any form of temporal gain to the advertiser, it is not prohibited.

Conclusion

Advertising is necessary if a business is to expect to turn a profit. However, that profit should not be made at the expense of another person. While the Forum for Responsible & Ethical E-mail is an organization that deals solely with electronic mail, we recognize that cost-shifting in advertising is not strictly limited to the online world. It is our desire to promote a bill which does the greatest amount of good, preserves the greatest number of rights to the people, involves the least amount of government interference, and protects our favored medium most. We think that this bill and its language is the best hope that this state and its citizens have in the war on cost-shifted advertising in general and unsolicited broadcast electronic mail in specific and we urge its passage.

Thank you, Mr. Chairman. I would be happy to answer any questions the committee might have.

Footnotes

1. This testimony was prepared with the advice and assistance of the FREE Board of Directors: Mickey Chandler, Ian Hays, Clifton Sharp, Jr., Steve Sobol, Kelly Thompson, and Doug Lim along with FREE's legislative aide, Dan Zerkle and former Board members, Steve Atkins, Laura Tessmer, and Leah Roberts. Some portions have been excerpted from the testimony of David H. Kramer, Esq., before the Washington State Legislature. Mr. Kramer may be contacted at Wilson Sonsini Goodrich & Rosati, Palo Alto, CA 94304, (650) 493-9300. Some portions have also been excerpted from the testimony of Ray Everett-Church, Esq., before the United States Senate Communications Subcommittee. Mr. Everett-Church may be contacted at (202) 588-0426.

2. Also called "Unsolicited Commercial E-mail" (UCE), or more broadly, "Unsoliticed Broadcast E-mail" (UBE), or in the vernacular, "spam."

3. "Spam Slows WorldNet Mail" - C|Net News (7/16/97) http://www.news.com/News/Item/0,4,12512,00.html

4. "Spam Snags @Home Mail System" - C|Net News (2/25/98) http://www.news.com/News/Item/0,4,19487,00.html

5. "Sprint Down for 5-hour Count" - C|Net News (9/3/96) http://www.news.com/News/Item/0,4,3039,00.html (discussing problems at both Sprint and GTE).

6. "Spam Clogs Netcom Lines" - C|Net News (4/29/97) http://www.news.com/News/Item/0,4,10204,00.html

7. "Pacific Bell Suffers Slowdown" - C|Net News (3/13/98) http://www.news.com/News/Item/0,4,20046,00.html; "PacBell Fights Spam Explosion" - ZDNet (3/13/98) http://www.zdnet.com/zdnn/content/zdnn/0313/294405.html

8. However, it is important to note that in nearly every lawsuit on UBE-related issues, the actions of junk electronic mailers have been found unlawful in one form or another. See, e.g., Cyber Promotions, Inc. v. America Online, Inc., C.A. No. 96-2486, 1996 WL 565818 (E.D. Pa. Sept. 5, 1996) (temporary restraining order), rev'd (3d Cir. Sept. 20, 1996), partial summary judgment granted, 948 F. Supp. 436 (E.D. Pa. Nov. 4, 1996) (on First Amendment issues), reconsideration denied, 948 F. Supp. 436, 447 (Dec. 20, 1996), temporary restraining order denied, 948 F. Supp. 456 (E.D. Pa. Nov. 26, 1996) (on antitrust claim), settlement entered (E.D. Pa. Feb. 4, 1997); America Online, Inc. v. Over the Air Equipment, Inc. (E.D. Va. complaint filed Oct. 2, 1997), preliminary injunction entered (Oct. 31, 1997), settlement order entered (Dec. 18, 1997); Bigfoot Partners, L.P. v. Cyber Promotions, Inc. (S.D.N.Y. complaint filed Oct. 6, 1997); In re: Canter, No. 95-831-O-H (Tenn. Bd. Prof. Resp. Feb. 25, 1997), disbarment order entered (Tenn. June 5, 1997); CompuServe Inc. v. Cyber Promotions, Inc., No. C2-96-1070 (S.D. Ohio Oct. 24, 1996) (temporary restraining order), preliminary injunction entered, 962 F. Supp. 1015 (S.D. Ohio Feb. 3, 1997), final consent order filed (E.D. Pa. May 9, 1997); Concentric Network Corp. v. Wallace, No. C-96 20829-RMW (EAI) (N.D. Cal. complaint filed Oct. 2, 1996), stipulated judgment entered (Nov. 5, 1996); Earthlink Network Inc. v. Cyber Promotions, Inc., No. BC 167502 (Cal. Super. Ct. L.A. County May 7, 1997) (preliminary injunction), consent judgment entered (Mar. 30, 1998); Expert Pages v. Universal Networks, Inc., No. 97-1542 SI ENE (N.D. Cal. May 2, 1997) (temporary restraining order); Parker v. C.N. Enterprises, No. 97-06273 (Tex. Travis County Dist. Ct. complaint filed May 26, 1997), temporary injunction entered (Sept. 17, 1997), permanent injunction entered and damages awarded (Nov. 10, 1997); People v. Lipsitz, 663 N.Y.S.2d 468 (N.Y. Sup. Ct. 1997); Prodigy Services Corp. v. Cyber Promotions, Inc. (S.D.N.Y. filed Oct. 18, 1996), settlement entered (Dec. 13, 1996); SimpleNet v. VNZ Information & Entertainment Services (S.D. Cal. complaint filed Nov. 13, 1997), default judgment entered (Apr. 15, 1998); Web Systems Corp. v. Cyber Promotions, Inc., No. 97-30156 (Tex. Harris County Dist. Ct. complaint filed June 1997), temporary restraining order entered (June 6, 1997).

9. Small ISPs are often unable to afford the massive redundant systems that larger companies can afford. Thus, processing UBE can slow down all of the functions on servers that might be filling multiple critical functions such as a mail server, a web server, and a domain name server. Constraints on server capacity are also one of the reasons "filtering" schemes are not viable solutions for many ISPs; filtering electronic mail consumes vast amounts of processing capacity and is the primary reason most ISPs cannot implement it as even a partial strategy for eliminating UBE.

10. All electronic mail sent contains routing information. Some UBE mailers have placed additional information into the headers in order to misdirect those who would report system abuse. These additional pieces of information, in Internet parlance, are called "forged headers."

11. "ybecker.net" was inserted into a falsified header by a popular UBE program called "Stealth Mailer."

12. We estimate that for every one complaint we did receive, there were three to four more that we did not receive because the recipient already knew who we are and that ybecker.net was a common forgery, or the recipient cursed the electronic mail, but just deleted it.

13. These forgeries still occur at sporadic intervals.

14. This was the first domain to suffer such infamy as a result of an aggressive anti-UBE policy. As a result, "revenge spams" are now often called "joe jobs."

15. "Blackholing" is the practice whereby one provider refuses to accept any sort of traffic from another under the cooperative arrangement theory. Realizing that the Internet is established on cooperative arrangements where each party to any given transaction pays a portion of the transaction costs, a provider will reject traffic from domains which are perceived to abuse those arrangements.

16. Dorn, Daniel P., "Postage Due on Junk Email -- Spam Costs Internet Millions Each Month," -- TechNet News, (5/4/98). A copy is attached, and with the committee's permission, I would like to incorporate it by reference for all purposes.

17. Blocking and filtering of UBE has proven extremely ineffective in combating UBE. In order to block or filter electronic mail, you must first know where it is coming from. Then once you implement a block for that location, a junk mailer can rapidly change their location. For example, they may send mail via an America Online connection, then once that route is blocked, they will reconnect via CompuServe, then via Netcom, and so on. In Internet parlance, these kinds of mailers are called "whack-a-moles," a reference to the popular carnival arcade game where you strike the mole with a mallet only to have it reappear somewhere else. Junk mailers obtain throw-away Internet accounts for one-time usage, bouncing from one ISP to the next, making up an address and launching their messages. While a receiving site can add that address to its filters, the spammer will seldom use that address again.

18. A copy of Novell's study is attached, and with the committee's permission, I would like to incorporate it by reference for all purposes.

19. Indeed, Aurora Nissan of Seattle, Washington, bought into one broadcast electronic mailer's promises of a "mailing targeted by geographical region." Reports from the USENET newsgroup news.admin.net-abuse.email show that this "targeted" e-mail was received by people as far away as North Carolina. Having discovered the ethical dubiousness of the practice, they have since canceled their contract with the e-mailer.

20. 397 U.S. 728, 737, 738 (1970) (citations omitted).

21. Id., at 733.

22. 341 U.S. 622 (1950).

23. Heitman v. State, 815 S.W.2d 681, 682 (Tex.Crim.App. 1991), held that Texas courts are may disregard federal guidelines to the extent that state protections exceed federal protections. See also, LeCroy v. Hanlon, 713 S.W.2d 335, 339 (Tex. 1986) (holding the Texas Constitution has independent vitality).

24. "[I]t is fundamental that state courts be left free and unfettered by us in interpreting their state constitutions." Minnesota v. National Tea Co., 309 U.S. 551, 557, 60 S.Ct. 676, 679, 84 L.Ed. 920 (1940). See also: City of Mesquite v. Aladdin's Castle, Inc., 455 U.S. 283, 293, 102 S.Ct. 1070, 1077, 71 L.Ed.2d 152 (1982) ("[A] state is entirely free to read its own State's constitution more broadly than this Court reads the Federal Constitution, or to reject the mode of analysis used by this Court in favor of a different analysis of its corresponding constitutional guarantee.")

25. O'Quinn v. State Bar of Texas, 763 S.W.2d 397, 402 (Tex.1988) (noting that "Texas' free speech right [has been characterized by at least one commentator] as being broader than its federal equivalent," the court concluded that "it is quite obvious that the Texas Constitution's affirmative grant of free speech is more broadly worded than the first amendment"); Channel 4, KGBT v. Briggs, 759 S.W.2d 939, 944 (Tex.1988) (Gonzalez, J., concurring) (the state provision is "more expansive than the United States Bill of Rights").

26. Reuters America, Inc. v. Sharp, 889 S.W.2d 646, 653 (Tex.App.-Austin 1994 , writ denied). ("The language of Article I, 8 is broader than the First Amendment. It grants an affirmative right to individuals to speak, write, or publish their opinions, but holds the speaker responsible for the abuse of this privilege.")

27. The bill also allows businesses any number of ways to utilize the Internet to reach a prospective customer. For example, businesses can utilize banner advertising on popular web sites, create their own web sites and register them with search engines, provide mechanisms for opting-in to e-mail mailing lists, enter into linking arrangements with companies sharing common markets, and make targeted and topical postings to appropriate Internet bulletin boards and newsgroups.

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