June 3, 2004, 12:00 AM

The FTC takes its first CAN-Spam action

When more than 1 million spam complaints made their way to the Federal Trade Commission since Jan. 1, the agency took the federal government’s first legal action under the new CAN-Spam Act in late April, charging two organizations with sending millions of spam e-mail messages.

When more than 1 million spam complaints made their way to the Federal Trade Commission since Jan. 1, the agency took the federal government’s first legal action under the new CAN-Spam Act in late April, charging two organizations with sending millions of spam e-mail messages.

The FTC, working with other federal and international agencies, filed complaints against Detroit-based Phoenix Avatar and Australia- and New Zealand-based Global Web Promotions. The lawsuits charge that each defendant violated CAN-Spam by obscuring their identities in the “reply-to” and “from” fields of their e-mail messages, and by failing to provide an opt-out feature within the messages. A federal judge has barred continued e-mailing by the defendants and frozen their assets.

The FTC, which also charged that each defendant violated the FTC Act by making deceptive product claims, said Phoenix Avatar earned nearly $100,000 a month selling $59.95 diet patches and that Global Web sold similar products at $80.

The government’s action follows six CAN-Spam lawsuits filed earlier this year by America Online Inc., EarthLink Inc., Microsoft Corp. and Yahoo Inc. The four charged several e-mailers with sending hundreds of millions of spam messages. CAN-Spam went into effect Jan. 1.

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