on the cover / By Ryan Burns

Rise and Fall of a Spam Crusader

A tiny Garberville Internet company won nearly $2.6 million in a junk-mail lawsuit before it all came crashing down

(Sept. 30, 2010)  On May 3 of this year, in Northern California’s U.S. District Court, a tiny Garberville company called ASIS Internet was awarded nearly $2.6 million in an anti-spam lawsuit. At the time, ASIS — an acronym for Access Solutions Information Services — had fewer than 1,000 customers, most of whom still accessed the Web through dial-up connections. The company had filed suit under the federal CAN-SPAM (Controlling the Assault of Non-Solicited Pornography And Marketing) Act of 2003, claiming that the defendant, an online marketer called Find a Quote, had sent its customers nearly 25,000 unsolicited e-mails over a period of 18 months. Ruling in ASIS’s favor, Judge Elizabeth D. Laporte awarded the Garberville company $2,596,020 in damages — nearly $650,000 for each of ASIS’s four employees.

Technology websites and bloggers heralded the victory as a David-versus-Goliath-type success story. London’s TheRegister, one of the world’s largest online tech publications, called the judgment “a testament to the awesome power of CAN-SPAM.”

Nella White on a retreat to study Vedanta and Sanskrit PHOTO SUBMITTED BY NELLA WHITE

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But when the Journal reached ASIS President Nella White a few days later, she was hesitant to talk about the ruling. It wasn’t exactly what it seemed, she said. “It makes a great headline, but the defendant can’t be found.” In fact, the primary defendant — a man by the name of Edward Heckerson — hadn’t bothered to show up for the trial or to respond in any way to the numerous allegations against him. Last anyone heard, Heckerson was hiding somewhere in Panama. Because he didn’t fight the allegations, the court granted a summary judgment that was impressive on paper but essentially worthless to the Garberville business, since the money couldn’t be collected.

A similar thing had happened the previous year in a Florida case filed by ASIS against a spammer called All In, LLC. There, too, the defendant was a no-show. At one point, according to ASIS’s lawyers, the search for All In’s president included a county sheriff’s deputy, a federal marshal and a process server. He was never found, so the Florida court’s judgment in favor of ASIS — $294,000 in damages and more than $12,000 in attorneys’ fees — has also never been collected.

White didn’t want to talk about any of this. She said she was involved in other litigation and would prefer to wait to discuss matters. Over the next few months, the Journal contacted White several times by e-mail; each time she responded that she wasn’t yet ready to talk. When finally reached by phone two weeks ago, White was agitated and distraught. She said she’d been forced to abandon not only her battle against spammers but her entire business, and now she was afraid of losing her house. “I’ve been eating Xanax with cream and sugar for breakfast,” she said.

Her distress, it turned out, stemmed from a ruling that came shortly after the $2.6 million victory. On May 19, a U.S. Magistrate judge ordered ASIS to pay more than $800,000 in attorneys’ fees to a company called Azoogle.com, Inc. More than two years prior, ASIS had filed suit against Azoogle, among more than 20 other defendants, alleging violations of both the CAN-SPAM Act and the California Business and Professions Code. The suit backfired. In April 2008 the court granted summary judgment in favor of Azoogle. (The other defendants had either settled or been dropped from the suit.) ASIS appealed the decision to the Ninth Circuit Court of Appeals, which, in December 2009, upheld the ruling with a curt, two-page declaration. In awarding attorney fees to Azoogle, the U.S. District Court found that ASIS had “acted unreasonably,” that its evidence against Azoogle was “extremely weak,” and that in bringing the lawsuit, ASIS likely had ulterior motives. Turns out they’d developed a habit of filing such claims.

“Having initiated over 20 similar actions, and sued over 20 defendants in this action alone, an award of attorneys’ fees here is necessary to deter ASIS and other plaintiffs hoping to profit under the CAN-SPAM Act,” Judge Joseph Spero ruled. Most of the 20-plus cases referred to by Spero had been settled before going to trial. In the judge’s eyes, ASIS — or their lawyer, at least — was little more than a serial litigant making a business of extortion.

This accusation was not a new one for ASIS’s lead attorney, Eureka litigator Jason Singleton, a man whose name strikes fear in the hearts of small business owners throughout California. Since 1997, Singleton has filed more than 75 lawsuits alleging violations of the Americans with Disabilities Act (ADA). These include cases against the County of Humboldt, the Eureka Chamber of Commerce, Barnes’ Family Drug, Open Door Community Health Centers and numerous local bars and restaurants. (His 2008 suit against Eureka’s Arctic Circle prompted the owners to close shop, hence the boarded-up windows you’ll see there to this day.) Singleton’s methods — which include filing multiple lawsuits on behalf of the same clients and often focusing on minor infractions of ADA law — have earned him a reputation as a shakedown artist (“Access and Dollars,” March 8, 2001; “Jason Singleton Strikes Again,” May 8, 2008).

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