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i.Justice Law, P.C. THE HON. JOHN C. COUGHENOUR

Robert J. Siegel

1325 Fourth Ave., Suite 940

Seattle, WA 98101

(206) 624-9392

UNITED STATES DISTRICT COURT

WESTERN DISTRICT OF WASHINGTON, SEATTLE

JAMES S. GORDON, Jr., a married

individual; OMNI INNOVATIONS,

LLC., a Washington limited

liability company;

Plaintiffs,

v.

VIRTUMUNDO, INC, a Delaware

corporation, d/b/a

ADNOWLEDGEMAIL.COM;

ADKNOWLEDGE, INC., a Delaware

corporation, d/b/a

ADKNOWLEDGEMAIL.COM;

SCOTT LYNN, an individual; and

JOHN DOES, I-X, 

Defendants.

NO. CV06-0204JCC

PLAINTIFF’S RESPONSE IN

OPPOSITION TO DEFENDANTS’

MOTION FOR ATTORNEY FEESS

[Hearing Noted Without Oral

Argument for July 6, 2007]

Plaintiff James S. Gordon, Jr., by and through his attorney of record, responds to

Defendants’ Motion For Attorney Fees as follows:

PLAINTIFF’S RESPONSE IN OPPOSITION TO 

DEFENDANTS’ MOTION FOR ATTORNEY FEES

-1

GORDON v. VIRTUMUNDO, INC., ET AL

i.Justice Law, PC

1325 Fourth Ave., Suite 940

Seattle, WA 98101

Phone: 206-304-5400

Fax: 206-624-0717

Case 2:06-cv-00204-JCC Document 135 Filed 07/02/2007 Page 1 of 9

Gordon v. Virtumundo Inc et al Doc. 135

Dockets.Justia.com
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At the outset, the Court should note the deep irony and manifest injustice that would

result if the Court grants the Defendants’ motion for attorney fees. 

In the Court’s May 15 ruling, the Court explicitly stated that the Court never considered

the merits of Plaintiff’s claims (hereafter Gordon).1 Rather, the Court held that Gordon

did not have standing to bring Gordon’s complaint. The Court included an extensive

analysis of Gordon’s standing under the CAN-SPAM Act of 2003, Pub. L. No. 108-187,

117 Stat. 2699 (2003), 15 U.S.C. §§ 7701-7713 (hereafter “CAN SPAM” or the “Act”).

The Court allowed that Gordon qualified as an “Internet Access Service” which is

specifically authorized to bring claims under the Act.2 However, the Court held that

Gordon had not suffered a sufficient “adverse impact” which is also required for

standing. The Court’s finding that Gordon had not suffered a sufficient adverse impact

thus formed the sole and exclusive basis given by the Court for finding that Gordon

lacked standing, and in turn dismissing Gordon’s complaint, under CAN SPAM. As a

result, the Defendants are now asking the Court to award them over a half a million

dollars, also under CAN SPAM, for the sole reason that the Court previously held

Gordon had not endured sufficient adverse impact to bring his claims.

1

 “Because Plaintiffs have no standing, their CAN-SPAM claims must be DISMISSED and the Court has

no occasion to reach the parties’ arguments on the merits of those claims.” (Court’s May 15, 2007 Order,

Dkt. 121, pg. 15, lines 18-19)

2

 “Nevertheless, it is fairly clear that Plaintiffs are, in the most general terms, a “service that enables users

to access” Internet content and e-mail, and accordingly, they qualify as an IAS under the statute’s

capacious definition.” (Court’s May 15, 2007 Order, Dkt. 121, pg. 13, lines 10-12)

PLAINTIFF’S RESPONSE IN OPPOSITION TO 

DEFENDANTS’ MOTION FOR ATTORNEY FEES

-2

GORDON v. VIRTUMUNDO, INC., ET AL

i.Justice Law, PC

1325 Fourth Ave., Suite 940

Seattle, WA 98101

Phone: 206-304-5400

Fax: 206-624-0717

Case 2:06-cv-00204-JCC Document 135 Filed 07/02/2007 Page 2 of 9
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If the Court grants the Defendants’ motion, Gordon will be financially ruined. Gordon

possesses nowhere near the resources necessary to satisfy such an award. If the

Court grants the Defendants’ motion, the Court will thus have ruled in rapid succession

that Gordon had not suffered a sufficient adverse impact to bring his claims under CAN

SPAM, yet for the mere act of trying, Gordon will have been ordered to pay over a half

million dollars and forced into bankruptcy. One can only wonder, if the Court grants the

Defendants’ motion and forces Gordon into financial ruin, will the Court then change its

mind and agree that Gordon has indeed suffered a sufficient adverse impact to have his

claims considered on the merits?

If the Court did, it is clear that Gordon would prevail. There is no question that Gordon

has made it crystal clear to the Defendants that he wants them to stop sending him

commercial email. Even if the Court ignores Gordon’s repeated requests as set forth in

his sworn declarations, this entire lawsuit is irrefutable evidence that the Defendants are

on notice that Gordon has made such a request. The Defendants are highly

sophisticated multi-million dollar corporations. In the face of this litigation, it is simply

inconceivable that the Defendants could have failed to note that Gordon doesn’t want

their commercial email. Thus, there is no question whatsoever that the Defendants

have both actual and constructive notice that Gordon doesn’t want their spam. 

CAN SPAM contains a clear prohibition against sending commercial email to a party

who has asked to be left alone. 15 USC 7704(a)(4). Yet the Defendants continue to

send Gordon commercial email to this day, on a daily basis. (See Gordon Declaration)

PLAINTIFF’S RESPONSE IN OPPOSITION TO 

DEFENDANTS’ MOTION FOR ATTORNEY FEES

-3

GORDON v. VIRTUMUNDO, INC., ET AL

i.Justice Law, PC

1325 Fourth Ave., Suite 940

Seattle, WA 98101

Phone: 206-304-5400

Fax: 206-624-0717

Case 2:06-cv-00204-JCC Document 135 Filed 07/02/2007 Page 3 of 9
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Since the Court has ruled that Gordon’s receipt of this commercial email is an

insufficient “adverse impact” to give Gordon standing to do anything about the

Defendants’ ongoing conduct under the Act, Gordon is effectively powerless to stop

these ongoing commercial emails. Gordon can only imagine the howls of laughter the

Defendants enjoy each and every day at Gordon’s expense, as they send Gordon

additional commercial email knowing that their conduct, while plainly contrary to CAN

SPAM, is nevertheless completely insulated from any redress by Gordon as a result of

this Court’s May 15 ruling. 

The awarding of attorney's fees is a matter for the District Court's discretion. To guide

that discretion, the Supreme Court endorsed the non-exclusive list employed by the

Third Circuit in Lieb v. Topstone Industries, Inc., 788 F.2d 151, 156 (1986) (the socalled "Lieb factors"). Fogerty v. Fantasy, Inc., 510 U.S. 517, 534, n.19, 114 S.Ct.

1023, 127 L.Ed.2d 455 (1994). The list includes "frivolousness, motivation, objective

unreasonableness (both in the factual and in the legal components of the case) and the

need in particular circumstances to advance considerations of compensation and

deterrence." Id. Examining these factors in order plainly indicates that it would be an

abuse of the Court’s discretion to grant the Defendants attorney fees.

PLAINTIFF’S RESPONSE IN OPPOSITION TO 

DEFENDANTS’ MOTION FOR ATTORNEY FEES

-4

GORDON v. VIRTUMUNDO, INC., ET AL

i.Justice Law, PC

1325 Fourth Ave., Suite 940

Seattle, WA 98101

Phone: 206-304-5400

Fax: 206-624-0717

Case 2:06-cv-00204-JCC Document 135 Filed 07/02/2007 Page 4 of 9
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Frivolousness

As stated by the Court, it never reached the merits of Gordon’s CAN SPAM complaint.

Accordingly, Gordon’s claims cannot possibly be termed “frivolous.” Further, it is plain

that if the Court had examined Gordon’s CAN SPAM claims on the merits, Gordon

would have prevailed. In addition to the other substantive claims, including, but not

limited to the “From” name argument asserted in Gordon’s motion for partial summary

judgment, and deceptive subject line claims, Gordon has repeatedly asked the

Defendants to stop sending Gordon commercial email. The Defendants were and are

on actual notice that Gordon wanted them to stop sending Gordon commercial email.

CAN SPAM contains a clear prohibition against sending commercial email to a party

who has asked to be left alone 15 USC 7704(a)(4). Despite Gordon’s repeated

requests, and the Defendants actual notice of those requests, the Defendants continue

to send Gordon commercial email on a daily basis (See Gordon Declaration herewith).

For Gordon to bring this suit under these conditions cannot be considered “frivolous.” 

Nor was it frivolous for Gordon to assume he had standing to bring this suit based on

his status as an “Internet Access Service.” As discussed above, the Court itself agreed

that Gordon was an “Internet Access Service” under a plain reading of the definition at

15 USC 7702(11) and 47 USC 231(e)(4). The Court also agreed that Gordon had

suffered an “adverse impact.” The Court’s rationale for denying standing thus required

the Court to reach into the legislative history to make a determination that Congress

intended something more than an “adverse impact.” The Court then concluded that

PLAINTIFF’S RESPONSE IN OPPOSITION TO 

DEFENDANTS’ MOTION FOR ATTORNEY FEES

-5

GORDON v. VIRTUMUNDO, INC., ET AL

i.Justice Law, PC

1325 Fourth Ave., Suite 940

Seattle, WA 98101

Phone: 206-304-5400

Fax: 206-624-0717

Case 2:06-cv-00204-JCC Document 135 Filed 07/02/2007 Page 5 of 9
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Gordon was required to show “ISP- or IAS-specific burdens,” that these be burdens be

“significant” and held that Gordon had not done so. (Court’s May 15, 2007 Order, Dkt.

121, pg. 13, lines 12-13). However, had Gordon known in advance that the Court would

apply this more stringent standard, Gordon easily could have established that he had

experienced “ISP- or IAS-specific burdens” and that the cost of these burdens were

“significant.” (See Gordon Declaration herewith) For example, the record plainly reflects

that due to a continually escalating avalanche of spam, Gordon was forced to migrate

his service from a shared server to a dedicated server. Had Gordon known that the

Court would apply this standard in advance, all Gordon would have had to do to meet it

is to point out to the Court that this forced migration entailed additional costs. However,

the point is not to re-litigate the Court’s prior ruling. The point is simply that Gordon’s

assumption that he had standing to bring his suit was based on a good faith, and

reasonable interpretation of the statutory language. The Court ultimately interpreted

that language to be more stringent. Gordon’s complaint cannot be considered

“frivolous” merely because he lacked the omniscience to know in advance that the Court

would adopt this more stringent standard, and thus an award of attorney fees is

unwarranted based upon frivolousness.

Moreover, as the Court has noted, and as Gordon readily acknowledges, Gordon has

brought numerous other lawsuits attempting to enforce both Federal and State antispam statutes. In each and every case in which Gordon’s standing as an IAS under

Can-Spam was challenged, other courts have found in Gordon’s favor, confirming his

status, on the facts as pled, as an IAS. In its decision herein the Court specifically

PLAINTIFF’S RESPONSE IN OPPOSITION TO 

DEFENDANTS’ MOTION FOR ATTORNEY FEES

-6

GORDON v. VIRTUMUNDO, INC., ET AL

i.Justice Law, PC

1325 Fourth Ave., Suite 940

Seattle, WA 98101

Phone: 206-304-5400

Fax: 206-624-0717

Case 2:06-cv-00204-JCC Document 135 Filed 07/02/2007 Page 6 of 9
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noted one such decision by the Eastern District Court of Washington Gordon v Impulse

Marketing, et al. where that Court, ruling on a challenge to Gordon’s status as an IAS

ruled in Gordon’s favor. Thus, there was certainly nothing frivolous, or otherwise

unreasonable in Gordon’s belief that he did have standing as an IAS to bring this action.

Motivation

Gordon’s motivation was to stop the Defendants from sending him spam. He filed his

lawsuit after a long and extended effort to stop the spam without resorting to litigation.

Unfortunately, that effort failed. The reasons that effort failed are best illustrated by the

fact that the Defendants are still sending spam to Gordon. (See Gordon Declaration

herewith) Unless the Court is willing to say that Gordon’s simple desire to be left alone

is an insufficient basis to bring an action when all else has failed, Gordon’s motivation

for bringing the suit does not support an award of attorney fees.

Objective Unreasonableness

In both the factual and the legal components of the case, Gordon’s position is entirely

reasonable. Factually, the Defendants were sending spam to Gordon despite his

requests that they stop. As noted above, they are legally required to do so under the

Act. The questions of standing are, at best, very close questions of first impression that

required the Court to review the legislative history to make a determination of

Congressional intent. Thus, in no sense was Gordon’s lawsuit “objectively

PLAINTIFF’S RESPONSE IN OPPOSITION TO 

DEFENDANTS’ MOTION FOR ATTORNEY FEES

-7

GORDON v. VIRTUMUNDO, INC., ET AL

i.Justice Law, PC

1325 Fourth Ave., Suite 940

Seattle, WA 98101

Phone: 206-304-5400

Fax: 206-624-0717

Case 2:06-cv-00204-JCC Document 135 Filed 07/02/2007 Page 7 of 9
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unreasonable” either factually or legally, and Gordon’s reasonableness in bringing the

suit does not support an award of attorney fees.

The Need to Advance Considerations of Compensation and Deterrence

As with the analysis of Gordon’s motivation, considerations of compensation and

deterrence do not support an award of attorney’s fees. Gordon’s intent was to stop the

Defendants from sending him spam. He filed his lawsuit only after a long and extended

effort to stop the spam without resorting to litigation. Sadly, the Defendants are still

sending spam to Gordon. Unless the Court is willing to say that it is the Court’s job to

deter Gordon from seeking redress in the Courts against a party who refuses to leave

Gordon alone, considerations of compensation and deterrence do not support an award

of attorney’s fees.

Conclusion

In light of the foregoing an award of attorney fees to Defendants is not warranted

and would create a manifest injustice. Consequently, Defendants’ Motion should be

denied.

RESPECTFULLY SUBMITTED this 2

nd day of July, 2007.

 DOUGLAS E. MCKINLEY, JR i.Justice Law, P.C. 

Attorney at Law

 /S/ Douglas E. McKinley, Jr. /S/ Robert J. Siegel 

Douglas E. McKinley, Jr., WSBA #20806 Robert J. Siegel, WSBA #17312

Attorney for Plaintiffs Attorney for Plaintiffs

PLAINTIFF’S RESPONSE IN OPPOSITION TO 

DEFENDANTS’ MOTION FOR ATTORNEY FEES

-8

GORDON v. VIRTUMUNDO, INC., ET AL

i.Justice Law, PC

1325 Fourth Ave., Suite 940

Seattle, WA 98101

Phone: 206-304-5400

Fax: 206-624-0717

Case 2:06-cv-00204-JCC Document 135 Filed 07/02/2007 Page 8 of 9
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CERTIFICATE OF SERVICE

I hereby certify that on this 2nd day of July, 2007, I electronically filed the subjoined

pleading with the Clerk of the Court using the CM/ECF System which will send notification

of such filing to the following: 

Attorneys for Defendants: Derek A. Newman, Newman & Newman, Michael Geroe. 

 /s/ Robert J Siegel 

Robert J. Siegel, WSBA 

WSBA #17312

ATTORNEY FOR PLAINTIFFS

PLAINTIFF’S RESPONSE IN OPPOSITION TO 

DEFENDANTS’ MOTION FOR ATTORNEY FEES

-9

GORDON v. VIRTUMUNDO, INC., ET AL

i.Justice Law, PC

1325 Fourth Ave., Suite 940

Seattle, WA 98101

Phone: 206-304-5400

Fax: 206-624-0717

Case 2:06-cv-00204-JCC Document 135 Filed 07/02/2007 Page 9 of 9