Hotmail Corporation v. Van$ Money Pie, Inc.
1998 WL 388389, 1 (N.D. Cal.)
Hotmail Corporation provides a free email service. In order to access
this service, you have to become a subscriber to Hotmail which requires you
to assent to the terms of a Service Agreement. The Terms of Service
contained in this Agreement specifically prohibit subscribers from using
Hotmail's services to send unsolicited commercial bulk e-mail or "spam,"
or to send obscene or pornographic messages. Hotmail is entitled to
terminate the account of any Hotmail subscriber who violates the Terms of
Service. The Terms of Service are presented in the form of a clickwrap
The defendant in this case was a spammer who had sent
spam to thousands of email addresses and had set up numerous Hotmail accounts
to facilitate their operations by using them as a "drop box" (i.e. an email
account to which responses to their original messages were sent, but whose
contents were never opened, read or responded to). As a result of this,
Hotmail was inundated with hundreds of thousands of misdirected responses,
as well as complaints from Hotmail subscribers regarding the spam.
This seriously affected Hotmail's finite computer capacity, causing significant
delay and costs in terms of increased personnel necessary to deal with the
complaints and problems created by the spam. Hotmail thus sought a
preliminary injunction preventing the defendant from using its email services
in the future. The District Court granted this noting that 'the evidence
supports a finding that the plaintiff will likely prevail on its breach of
contract claim and that there are at least serious questions going to the
merits of this claim'.
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