Update: Woman Wins Spam Lawsuit Against Kozmo.com

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In what is thought to be the first case of its kind, a California woman has successfully sued Kozmo for sending her spam and has been awarded monetary damages.

On April 16, Ellen Spertus was awarded $77.50 in a lawsuit filed in the Small Claims Division of the Superior Court of California in San Francisco. She claimed that after alerting Kozmo that she no longer was interested in receiving e-mail from the company, it sent her a message Nov. 23 that while acknowledging she had opted out of mailings, proceeded to fill her in on new services. That e-mail also advised her she could opt back in to its list on the Kozmo.com Web site.

Spertus, a computer science professor at Mills College in Oakland, CA, said that though she receives a lot of spam, that particular one "drove her over the edge" and prompted her lawsuit. The court said the Kozmo e-mail violated California spam statutes, which were enacted in 1999, and awarded Spertus $50 for the single e-mail and $27.50 in court costs. She originally sought $500 from the court.

No one at Kozmo was available to comment.

"I doubt I'll ever collect, since Kozmo is going out of business, but I'm very pleased with the outcome," Spertus said.

Kozmo went out of business this month. The company, based in New York, was an Internet retailer and delivery company that promised to deliver goods such as rental videos and Ben & Jerry's ice cream to local users in an hour.

The company on Nov. 23 sent e-mail to its list asking whether members who had opted out of future mailings wanted to change their minds.

"Through customer feedback we heard that many of our members like you, who originally opted not to receive occasional e-mail news from us, would like to change their preferences," the e-mail read. It went on to explain a new gift service the company was instituting.

Spertus said she complained to Kozmo's privacy unit about the e-mail but that her message was returned as undeliverable.

"At this point I sent a registered letter to Kozmo asking for an apology, $250 and assurance that this would not happen again," she said.

A Kozmo customer service representative on Nov. 28 sent a reply to Spertus, acknowledging that the e-mail she received was sent to all those who had previously opted out of such mailings.

"Please know that this particular e-mail was knowingly sent out to all customers who elected not to opt in during sign-up," the letter stated. "This e-mail is a one-time only announcement and was in no way intended to be obnoxious."

The e-mail apologized for possibly offending Spertus and said Kozmo hoped it would not make her think negatively about the company.

In December, Kozmo spokesman Matt Higgins said the company did not think the e-mail was inappropriate.

"The reasoning behind it is, because of the way our site was structured, many customers inadvertently opted out of receiving promotional e-mails from Kozmo," Higgins said at the time. "Our customer service [department] would receive inquiries from consumers who didn't realize that they'd opted out. They complained they hadn't received certain notices from Kozmo."

Since this was a small claims case, it is not expected to set legal precedent. But businesses may be more careful about sending e-mail if they know people can successfully sue.

"It's interesting because it demonstrates that businesses need to be careful about how they use e-mail," said David Sorkin, assistant professor of law at The John Marshall Law School, Chicago, who watches spam issues closely. "More specifically, it illustrates the dangers of disregarding a customer's opt-in/opt-out decision."

Sorkin noted that Kozmo essentially lost the case for itself by admitting that it sent e-mail to people who had previously opted out and, on top of that, including an advertisement in the message.

"Even if Kozmo did have a valid reason for sending e-mail to people who had previously asked not to receive it, Kozmo should have limited the content of the message to informing customers how they could opt in to receive further communications, rather than including an advertisement," he said.

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