UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF NEW HAMPSHIR E

CHRISTOPHER SPENCE, an individual,

on his on behalf, and on behalf of all

persons similarly situated ,

67 Old Rockingham Road

Salem, NH 0307 9

Plaintiff ,

V .

Civil Docket No .

CLASS ACTION

JURY TRIAL DEMANDED

BORDERWARE TECHNOLOGIES, INC .,

a Canadian corporation , and DOES

1 to 10, individuals .

500 Burnhamthorpe Rd West #502

Mississauga ON, Canda L5B 3C2

Defendant.

CLASS ACTION COMPLAIN T

Plaintiff Christopher Spence ("Plaintiff), by his attorneys, states this Class Action

Complaint against Defendant BorderWare Technologies, Inc . ("BorderWare" or "Defendant").

Plaintiffs allegations are based on information and belief, except to his own actions, which are

based on knowledge. Plaintiffs allegations on information and belief are based on the

investigation of his counsel, and facts that are a matter of public record .

Nature of the Clai m

1 . This class action claim against BorderWare arises out of BorderWare's false promotion

and advertising of its antispam appliance MXtreme Mail Firewall ("MXtreme") .

2. MXtreme is an antispam appliance used to eliminate unsolicited commercial email

("spam"). BorderWare promoted and advertised MXtreme as appropriate for use by

Internet service providers ("ISPs") who managed Internet connectivity and email service

for multiple clients (as opposed to local network operators who manage only their only

internal network). Further, Borderware claimed that MXtreme generally identified very

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few legitimate emails as spam (i .e., "false positives") .

3 . BorderWare knew that both these functionalities were critical to a large class of

MXtreme purchasers (including Plaintiff). However, BorderWare also knew that, in fact,

MXtreme did not have the functionalities necessary for ISP use, nor was MXtreme's false

positive rate as low as it claimed when it promoted MXtreme . Nonetheless, BorderWare

used these false statements to advertise MXtreme at least from May 2004 to August

2005.

4. These misrepresentations not only harmed the ISP customers who relied on them through

the purchase of useless equipment, but also impaired the availability of email sent to ISP

customers' facilities.

5. BorderWare maintained these misrepresentations throughout negotiations with

customers, including Spence.

6. BorderWare's Misrepresentations violated, inter a/ia, the U.S. Computer Fraud and

Abuse Act, the New Hampshire Consumer Fraud Act, the Canadian Competition Act,

and Ontario common law torts of fraud and negligent misrepresentation . This lawsuit

seeks to provide BorderWare's customers a remedy for BorderWare's deceptive

advertising and promotion of the MXtreme.

Parties

7. Christopher Spence ("Plaintiff') is a New Hampshire resident who does business as

Algorithm Consulting in Windham, New Hampshire .

8. Defendant BorderWare Technologies, Inc. is a Canadian corporation which maintains

and at all relevant times maintained its headquarters at 500 Burnhamthrope Road West

No. 502, Mississaugua Ontario, L5B 3C2 . Founded in 1994, BorderWare is the

benchmark provider of messaging security solutions for enterprises and government .

BorderWare has more than 8000 customers with systems deployed at various military ,

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intelligence, defense, national security agencies, and corporations worldwide .

9. Defendants Does 1 to 10 are officers, agents, and employees of BorderWare . They

conducted and/or participated in the conduct BorderWare's affairs through the activity

described herein and are individually culpable for BorderWare's corporate misconduct .

The identity of the Does is unknown, but is readily discoverable in litigation or

arbitration.

Jurisdiction and Venu e

10. The aggregate claims of Plaintiff and the proposed class members substantially exceed

the sum or value of $5,000,000, and there is diversity of citizenship between proposed

class members and Defendant. This Court has subject matter jurisdiction over this case

under 28 U.S.C. § 1332(d).

11 . Plaintiff asserts federal claim on behalf of himself and all others similarly situated . This

Court has subject matter jurisdiction over this case under 28 U.S.C. § 1331 .

12. This Court has personal jurisdiction over the Defendant under RSA 293-A :15 :10 by

virtue of the Defendant's commission of tortious acts in this District. Venue is also proper

in this District under 28 U .S.C. § 1391(a)(2).

The Market for Antispam Appliances

13. Email is a critical form of communication in any contemporary organization. Email users

receive email from their network's email servers. Some organizations maintain their

email servers on their own local network. Many other organizations and many individual

users use Internet service providers ("ISPs") to both provide Internet connectivity and

email service (including maintaining email servers) . As the cost of sending email is very

low, spam has become so prevalent as to present a massive problem for email users . At

its present-day levels, spam threatens to drown out legitimate email by sheer volume, to

cripple network connectivity, and to expose users to viruses, trojan horses, and othe r

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forms of malware.

14. Consequently, a market has evolved to eliminate spam before it reaches individual email

users. For instance, and other manufacturers produce antispam appliances, specialized

routers or computers which filter spam before it reaches users' email servers . Defendant's

MXtreme is an antispam appliance .

15. Because email is a critical form of communication, one of the most important criteria for

evaluating an antispam device is the rate at which the device incorrectly identifies

legitimate email and spam (i.e., "false positive" rate). Because antispam appliances

eliminate email before it reaches a user's email inbox, a user may never learn that a

legitimate, critical email failed to reach him.

16. Antispam devices "quarantine" email identified as spam, because any false positive may

be a critical email. Users' ability to retrieve emails from an antispam device's

"quarantine" is as critical as the antispam device's false positive rate . Likewise, users'

ability to white-list, or specifically designate a particular email source as legitimate, is

also important. Moreover, antispam devices must provide users these capabilities. ISPs

must rely on individual users to manage their own quarantines and white lists, both

because ISPs cannot decide for users decide what email is legitimate and because the

workload involved in administrating all an ISPs' individual email accounts is not tenable .

17. Consequently, a manufacturer's representations about an antispam appliance's false

positive rate, and its quarantine and white-listing capabilities are necessarily material to

any purchaser.

18. Antispam devices have two basic classes of prospective purchasers. The first class is only

concerned with protecting its own internal network from spam. This class is typically

limited to large organizations that operate their own network. The second class are ISPs,

which provide network connectivity and email service to multiple clients .

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19. The domain name portion of an email address follows the @ symbol . (Thus, the domain

name for webmaster@nhd .uscourts.gov is nhd.uscourts.gov .) The domain name is used

to direct email to the correct email server, where a user can access the messages sent to

his address.

20. Another important criteria for antispam devices is whether they can accommodate

multiple email address domains . ISPs which offer email service to multiple clients, with

each client using its own domain name, must have the ability to receive email sent to

multiple domain names. While prospective purchasers which only operate their own

network may have but a single domain name, they may also have multiple domain names .

In particular, large organizations frequently use several tertiary domain names (for

instance, nhd.uscourts.gov, nysd.uscourts.gov and ilnd.uscourts.gov). Thus,

representations about an antispam appliance's ability to process multiple domain name

are necessarily material to any purchaser using multiple domain names .

BorderWare's Misrepresentations to the Class

21 . BorderWare promoted and advertised MXtreme as "enabl[ing users] to easily manage

multiple email domains or work groups from a single web-based console" in a document

titled MXtreme Product Overview, dated December 2003, a copy of which is attached as

Exhibit A. Spence received this document from a BorderWare representative by email in

May 2004, a copy of which is attached as Exhibit B .

22. BorderWare also promoted and advertised MXtreme as having an extremely low false

positive rate. MXtreme Product Overview claimed MXtreme provided "zero lost

messages for your enterprise ." Ex. A at 2. BorderWare's website also claimed MXtrem e

"provide[d] remarkably low ratios of 1 in 100,000 false positives." The BorderWar e

maintained this claim on its website from at least May 2004 to March 2005 ,

automatically archived copies of which are attached as Exhibits C and D .

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23. Finally, BorderWare claimed that MXtreme enabled email "[u]sers [to] build their own

personalized whitelists and manage their own quarantine areas." Exs. C; D.

24. The misrepresentations in the three previous Paragraphs ("Class Misrepresentations" or

simply "Misrepresentations") were made to every member of the Class .

BorderWare's Specific Misrepresentations to Spence

25. Spence provides managed email service to other enterprises. It is essential to his business

(and to the business of every other Class member) that his network equipment, and

specifically, his antispam equipment, process email for a variety of clients with multiple

domain names.

26. For three months prior to his purchase, Spence consulted with BorderWare promotional

material about the MXtreme functionality and repeatedly inquired with BorderWare

employees whether MXtreme would fit his needs. Throughout this time, Spence was very

clear that he required multiple domain name functionality and that MXtreme otherwise

had to be appropriate for his environment, and was consistently assured that it was . A

BorderWare employee acknowledged that Spence "made it very clear to me that multiple

domain support is necessary for his environment" in an email dated September 3, 2004

and attached as Exhibit E.

27. In addition to the General Misrepresentations above, Spence was also told that the

MXtreme was appropriate for his environment, and specifically would support multiple

domains and was used by other ISPs . Spence was given these statements, inter a/ia, by

David Schultz in web conference on or about July 20, 2004 and repeatedly over

telephone by Robert Piccolo during the three months prior to Spence's purchase .

28. Spence purchased two MXtreme appliances in August 5, 2004. A copy of a reprinted

invoice is attached as Exhibit F. However, MXtreme did not have the functionality

BorderWare advertised.

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29. After Spence discovered that MXtreme did not work as advertised, BorderWare

represented that future changes to the MXtreme software would provide MXtreme with

the functionalities described in its advertising . The representations include:

(a) emails from an BorderWare employee, dated August 10, 2004 and

attached as Exhibits G and H, that the 5 .0 MXtreme version 5 .0 was due in

October 2004 and would provide "domain based" white listing and

quarantine;

(b) an email from an BorderWare employee, dated August 31, 2004 and

attached as Exhibit I, that a patch for the then-current version of MXtreme

would be "released in a few weeks" and "support multi-domain"

functionality;

(c) an email from an BorderWare employee, dated September 24, 2004 and

attached as Exhibit J, that an upcoming patch would provide MXtreme

with "[m]ulti-domain support" for "non-local hosts" ;

(d) an email from an BorderWare employee, dated October 13, 2004 and

attached as Exhibit K, that the upcoming patch was just being packaged

and would be available as early as tomorrow, together with another email

dated November 29, 2004 and attached as Exhibit L, that the patch had

been delayed and would not go out until the end of that week ;

(e) and an email from an BorderWare employee, dated February 8, 2005 and

attached as Exhibit M, that BorderWare was "committed to going the

extra mile to ensure your long-term satisfaction with the quality and

support of our product and services. "

30. The misrepresentations alleged in the three previous Paragraphs ("Specific

Misrepresentations") induced Spence to devote an enormous amount of time to testing

MXtremes per BorderWare's instructions and attempting to configure them to function as

they were advertised, to incorporate them into his business. This work was of substantial

benefit to BorderWare. A BorderWare vice-president indicated in an email dated August

31, 2004 and attached as Exhibit N that Spence's input was "useful and valuable" and

would be used in future product development.

31 . The Specific Misrepresentations also induced Spence to purchase a substantial amount of

marketing services (including graphical design and web design) for his business that were

adapted to MXtreme and could not be retrofitted to another product.

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MXtreme 's Functionality

32. At the most basic level, MXtreme failed to provide false positive ratios anywhere near a

low as 1 in 100,000 . A BorderWare employee acknowledged in an email dated February

9, 2005 and attached as Exhibit 0 that the false negative and false positive ratios of

Spence's MXtremes "have gotten better over time but are not what they should be ." Ex.

Oat 1 .

33. Further, MXtreme did not support multiple domain names in a ISP (multiple domain

name) environment. MXtremes would process email for one domain name normally .

However, despite nearly a year of Spence's assistance, BorderWare was never able to

configure MXtreme to provide users with quarantine or white-listing functionality with

additional domain name . In addition to MXtreme's basic failure to provide the false

positive rates BorderWare advertised, this defect rendered MXtremes totally unsuitable

for a customer, such as an ISP, using multiple domain names.

BorderWare Refuses to Refund Spence 's Purchase Money

34. BorderWare knew the Class Misrepresentations were material to its customers, and

acknowledged that MXtreme did not yet provide the functionality described in the Class

Misrepresentations. A BorderWare employee stated that "carrier and ISP businesses"

required "support for multi-domains [and] pushing admin capabilities [i.e., white listing

and quarantines] down to the end user," just as Spence's business did . Ex . 0 at 1 .

35. By March 2005, BorderWare essentially stopped working with Spence to resolve the

MXtreme's functionality defects and did not communicate with Spence for three months.

36. On July 18, 2005, after nearly a year of patiently working with BorderWare to resolve th e

issues that plagued MXtreme, Spence asked BorderWare to take back the defective

MXtremes and return his purchase money.

37. On August 3, 2005, BorderWare's vice-president wrote an email, attached as Exhibit P ,

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which apologized for the delay, asked Spence to "be patient a little bit longer," and

indicated he would "respond shortly ." On August 8, 2005, just a few days after the

anniversary of the date Spence purchased his MXtremes, the vice-president indicated that

BorderWare would not refund Spence's money.

Class Action Allegation s

38. Plaintiff brings this Complaint against Defendant on behalf of himself and all persons and

entities which purchased an MXtreme for use with multiple domain names, regardless of

their residence, pursuant to Federal Rule of Civil Procedure 23 (the "Class") . Plaintiff

also brings this Complaint against Defendant on behalf of himself and all natural persons

within a distinct subclass of Class members who reside, or operate a data storage or

communications facility, in the United States (the "U .S. Subclass"). Excluded from both

the Class and U.S . Subclass are i) any Judge or Magistrate presiding over this action and

members of their families; ii) Defendant, Defendant's subsidiaries, parents, successors,

predecessors, and any entity in which the Defendant or its parent has a controlling

interest and their current or former employees, officers and directors ; and iii) persons

who properly execute and file a timely request for exclusion from the class and iv) the

legal representatives, successors or assigns of any such excluded persons.

39. Numerosity : The exact number of Class and U .S. Subclass members is unknown and is

not available to Plaintiff, but it is clear that individual joinder of all members of either the

Class or U.S . Subclass is impracticable . BorderWare claims it has over 8,000 customers .

A significant proportion, even a majority, of those customers would attempt to use

MXtreme for multiple domain names . Further, a significant proportion of Class members

reside, or operate a data storage or communications facility, in the United States.

40. Class Commonality: Common questions of fact and law exist as to all Class members

and predominate over the questions affecting only individual Class members . These

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common questions include whether:

(a) Whether BorderWare's advertisements and promotions for the MXtreme

represented that processed email for multiple domain names, provided

white-listing and quarantine functionality to individual email users, and

provided a false positive rate of 1 in 100,000 ;

(b) Whether BorderWare represented that MXtreme was generally suited for

use by an ISP;

(c) Whether the Misrepresentations alleged above are false or misleading in a

material respect ;

(d) Whether BorderWare and the Does knew the Misrepresentations alleged

above were false at the time it made them, or made with with reckless

disregard for the truth;

(e) Whether, by its misconduct as set forth herein, BorderWare and the Does

violated the Canadian Competition Act ;

(f)

(g)

Whether, by its misconduct as set forth herein, BorderWare and the Does

committed the torts of deceit and/or negligent misrepresentation under

Ontario law;

Whether plaintiff and the Class are entitled to relief, and the nature of such

relief.

41 . U.S. Subclass Commonality: Common questions of fact and law exist as to all members

of the U.S. Subclass and predominate over the questions affecting only individual U .S.

Subclass members. These common questions include whether :

(a) Whether BorderWare's Misrepresentations transmitted information to

network and email facilities in the United States, and which

Misrepresentations intentionally induced those facilities to purchase and

install MXtreme;

(b) Whether the installation of MXtreme in network and email facilities in the

United States impaired access to email, and required time, effort and

money to repair, reconfigure and/or replace ;

(c) Whether, by its misconduct as set forth herein, BorderWare violated the

Computer Fraud and Abuse Act, 18 U.S .C. § 1030;

(d) Whether BorderWare's Misrepresentations were transmitted across

interstate wires;

(e) Whether BorderWare's Misrepresentations constituted wire fraud under 18

U.S .C. § 1343 ;

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(f)

(g)

Whether BorderWare's Misrepresentations to the U.S . Subclass constitute

a pattern of racketeering activity;

Whether BorderWare is an enterprise involved in interstate activity,

separate and distinct from the Does ;

(h) Whether the Does participated in BorderWare's conduct of its affairs

through a pattern of racketeering activity;

Whether the U.S . Subclass was damaged in its business or property by

such pattern of racketeering activity ;

Whether plaintiff and the U.S. Subclass are entitled to relief, and the

amount and nature of such relief

42. Typicality : Most of Plaintiffs claims are typical of the claims of other members of both

the Class and U.S . Subclass, as the Plaintiff and other Class members sustained damages

arising out of Defendant's wrongful conduct based upon the same transactions, upon the

same misrepresentations, and upon the same material omissions which were made

uniformly to the Plaintiff and the public .

43. Adequate Representation : Plaintiff will fairly and adequately represent and protect the

interests of the other members of both the Class and U.S. Subclass, and has retained

counsel competent and experienced in complex class actions. Plaintiff has no interest

antagonistic to those of the Class or to the U .S. Subclass, and Defendant has no defenses

unique to Plaintiff.

44. Predominance and Superiority : This class action is appropriate for certification

because class proceedings are superior to all other available methods for the fair and

efficient adjudication of this controversy, since joinder of all members is impracticable .

The damages suffered by each individual Class member will likely be relatively small,

especially given the burden and expense of individual prosecution of the complex

litigation necessitated by Defendants' actions. It would be virtually impossible for the

Class members individually to obtain effective relief from Defendants' misconduct. Even

if the class members themselves could sustain such individual litigation, it would still no t

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be preferable to a class action, because individual litigation would increase the delay and

expense to all parties due to the complex legal and factual controversies presented in this

Complaint. By contrast, a class action presents far fewer management difficulties and

provides the benefits of single adjudication, economy of scale, and comprehensive

supervision by a single Court. Economies of time, effort, and expense will be fostered

and uniformity of decisions will be ensured .

Class Allegations

45. Does' Corporate Control: Does 1 to 10 made the decision to have BorderWare, through

its agents and employees, make the Class Misrepresentations. The Does had the authority

to direct other BorderWare employees to make the Misrepresentations.

46. Specifies of Class Misrepresentations : The Class Misrepresentations related, as alleged

above, to the MXtreme's false positive rate and its support for multiple domain names.

The Class Misrepresentations were made to Class members through, inter a/ia,

BorderWare's sales staff and its website.

47. Falsity: The Class Misrepresentations were false or misleading.

48. Intent or Recklessness as to Falsity: BorderWare and the Does knew that the

Misrepresentations were false, or were at least reckless with respect to the falsity of the

Misrepresentations.

49. Intent as to Reliance : BorderWare and the Does made the Class Misrepresentations for

the purpose of selling MXtremes. BorderWare and the Does intended that the Class

members rely on the Class Misrepresentations, regardless of whether the MXtremes

suited Class members' business needs or not. In the alternative, BorderWare and the Does

knew that Class members would rely on the Class Misrepresentations.

Count I : Spence's Individual Claim

Under the New Hampshire Consumer Fraud Act

50. Plaintiff incorporates the above allegations by reference as if set forth herein at length .

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51 . Through the Class and Specific Misrepresentations alleged above, BorderWare

represented that the MXtreme had uses, benefits and functionalities that it did not have .

52. By making the Class and Specific Misrepresentations, BorderWare violated the NHCFA,

RSA 358-A:2.

53. By directing agents and employees of BorderWare to make the Class and Specific

Misrepresentations, the Does violated the NHCFA, RSA 358-A :2 .

54. Spence seeks treble actual damages (including direct damages and consequential

damages, including marketing expenses made in reliance of incorporating MXtreme into

his business and time wasted attempting to configure the MXtreme to function as

advertised) from BorderWare under the NHCFA, RSA 358-A:10. Spence also seeks an

injunction against further NHCFA violations and statutory attorneys' fees award against

BorderWare.

55. Spence seeks treble actual damages from the Does under the NHCFA, RSA 358-A : 10 .

Spence also seeks an injunction against further NHCFA violations and statutory

attorneys' fees award against the Does.

Count II : Violation of the Competition Act, R.S. 1985, c. C-34

56. Plaintiff incorporates the above allegations by reference as if set forth herein at length .

57. By making the General Misrepresentations, BorderWare violated the Competition Act,

R.S. 1985, c. C-34, s. 52.

58. By directing agents and employees of BorderWare to make the Class Misrepresentations,

the Does violated the Competition Act, R.S. 1985, c. C-34, s. 52.

59. Spence and the other Class members were damaged by the Class Misrepresentations .

60. Plaintiff, on his own behalf and behalf of the other Class members, seeks direct damages

and the full costs of Spence's investigation in connection with this case and of the

proceedings from BorderWare under the Competition Act, s. 36.

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61 . Plaintiff, on his own behalf and behalf of the other Class members, seeks damages and

the full costs of Spence's investigation in connection with this case and of the

proceedings from the Does under the Competition Act, s . 36.

Count III : Deceit

62. Plaintiff incorporates the above allegations by reference as if set forth herein at length .

63. Spence and the other Class members relied on the Class Misrepresentations, purchased

MXtremes, and were damaged thereby.

64. Plaintiff, on his own behalf and behalf of the other Class members, seeks direct damages,

punitive damages and costs from BorderWare .

65. Plaintiff, on his own behalf and behalf of the other Class members, seeks direct damages,

punitive damages and costs from the Does.

Count IV: Negligent Misrepresentatio n

66. Plaintiff incorporates the above allegations by reference as if set forth herein at length .

67. In the alternative, BorderWare and the Does were negligent with respect to the Class

Misrepresentations. They should have known that the Class Misrepresentations were

false or misleading, and that Spence and the other Class Members would rely on the

General Misrepresentations.

68. Spence and the other Class members relied on the Class Misrepresentations, purchased

MXtremes, and were damaged thereby.

69. Plaintiff, on his own behalf and behalf of the other Class members, seeks direct damages,

punitive damages and costs from BorderWare .

70. Plaintiff, on his own behalf and behalf of the other Class members, seeks damages

(including punitive damages) and costs from the Does.

Count V: Violation of the Computer Fraud and Abuse Act , 18 U .S.C. § 1030

71 . Plaintiff incorporates the above allegations by reference as if set forth herein at length .

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72. Does 1 to 10 caused the Class Misrepresentations to be transmitted through BorderWare's

website and sales staff.

73. Spence and the U .S. Subclass operate data storage and communications facilities, which

are "protected computers" under the definition in 18 U .S.C. § 1030(e).

74. Through the Class Misrepresentations, BorderWare and the Does knowingly transmitted

information to the Spence and the U .S. Subclass regarding MXtreme's false positive rates

and support for multiple domain names that induced Spence and the U .S. Subclass into

purchasing and installing MXtremes .

75. BorderWare and the Does knew the installation of the MXtremes would damage the data

storage and communications facilities by misdelivering email, failing to provide a

quarantine for false positives, and otherwise impairing users' access to data .

76. Spence and the U .S . Subclass relied on the Class Misrepresentations: their reliance was

misplaced and to their detriment. As the MXtremes' lack of functionality directly

conflicted with the Class Misrepresentations, the damage caused by installing the

MXtremes was not authorized .

77. BorderWare and the Does violated 18 U .S.C. § 1030(a)(5)(A)(i) by making the Class

Misrepresentations.

78. The Class Misrepresentations caused losses, the value of which exceeded $5,000 during

the year after Spence and the other U .S . Subclass members relied on the General

Misrepresentations.

79. Plaintiff, on his own behalf and behalf of the other U.S. Subclass members, seeks direct

damages under 18 U.S.C. § 1030(g) from BorderWare.

80. Plaintiff, on his own behalf and behalf of the other U.S. Subclass members, seeks all

losses recoverable under 18 U .S .C . § 1030(g) from the Does.

Count VI : Violation of the Racketeer Influenced

and Corrupt Organizations Act, 18 U .S.C. § 1962

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81 . Plaintiff incorporates the above allegations by reference as if set forth herein at length .

82. Scheme to Defraud : Does 1 to 10 participated and acted in concert in a scheme to

defraud Spence and the other U.S . Subclass members . The Class Misrepresentations were

an integral part of that scheme, and induced the Class members to purchase MXtremes

which did not support their business needs.

83. Interstate Wire : The Class Misrepresentations were made using the interstate wires (to

wit, they were made to U .S. persons by way of email, telephone call and Internet website

from Ontario, Canada). The Does knew or reasonably should have known the Class

Misrepresentations would use interstate wires.

84. Racketeering Activity : The Does' conduct constituted wire fraud and violated 18 U.S.C.

§ 1343. Violation of 18 U.S.C. § 1343 constitutes racketeering activity .

85. Pattern of Racketeering Activity: Spence and the other Class members relies on the

Class Misrepresentations and purchased MXtremes, and were damaged thereby by the

purchase of an antispam appliance that did not have the functionality their businesses

required. Each time a U.S. Subclass member purchased an MXtreme in reliance on the

Class Misrepresentations, the Does violated 18 U.S.C. § 1343. Many of these violations

occurred during the course of selling the MXtreme. Where BorderWare's customers

number in the thousands, it is likely that the wire fraud violations number in the

thousands. These wire fraud violations are related to each other and, in fact, constitute

multiple frauds executed from a single scheme . Further, the wire fraud violations are

continuous: the scheme began at least in December 2003 and continued through at least

August 2005 . Further, the wire fraud was part and parcel of BorderWare's legitimate

business: the sale of MXtremes.

86. Enterprise: BorderWare is an enterprise involved in interstate commerce that is separate

and distinct from the Does.

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87. Participation in the Conduct of BorderWare's Affairs : The Does participated in the

conduct of BorderWare's affairs through the pattern of racketeering activity alleged

above.

88. Business Damage Caused by Pattern of Racketeering Activity: The pattern of

racketeering activity caused economic and business injury to Spence and the other Class

members.

89. Plaintiff, on his own behalf and behalf of the other U.S. Subclass members, seeks treble

damages, an injunction against further violations of the Racketeer Influenced and Corrupt

Organizations Act, and a statutory award of costs (including attorneys' fees) under 18

U.S .C . § 1964(c) from the Does.

90. WHEREFORE, Plaintiff prays that the Court enter judgment and orders in their favor and

against Defendant as follows :

(a) With respect to Count I, treble damages against BorderWare and the Does,

an injunction against further violations of the New Hampshire Consumer

Fraud Act, and statutory attorneys' fees under the New Hampshire

Consumer Fraud Act ;

(b) With respect to Counts II, III, and IV, declaring the action to be a proper

class action and designating Plaintiff and his counsel as representatives of

the Class;

(c) With respect to Counts II, III, and IV, awarding damages in an amount to

be determined at trial, the full costs of investigation and proceedings, and

equitable relief, including an accounting, a constructive trust an d

restitution, in an amount to be determined at trial, against the Does and

BorderWare ;

(d)

(e)

(0

With respect to Counts V and VI, declaring the action to be a proper class

action and designating Plaintiff and his counsel as representatives of the

U.S . Subclass;

With respect to Counts V, and VI, awarding treble damages in an amount

to be determined at trial, an injunction against further violations of the

Racketeer Influenced and Corrupt Organizations Act, and costs (including

attorneys' fees) under the Racketeer Influenced and Corrupt Organizations

Act, against the Does and BorderWare;

Awarding pre- and post-judgment interest ; and

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Case 1:06-cv-00349-JM Document 1 Filed 09/18/06 Page 17 of 18
(g) Granting such other and further relief as the Court may deem just and

proper.

JURY TRIAL DEMAN D

The Plaintiff hereby demands a trial by jury of all issues so triable .

Dated: September 18, 2006 Respectfully Submitted,

/s/ Joshua E . Menard

Joshua E. Menard, NHBAR #15352

PRETI FLAHERTY PLLP

57 North Main Street

P.O. Box 131 8

Concord, NH 033 02-1 3 1 8

(603) 410-1500

-andScott A. Kamber (NY 2506707 )

TO BE ADMITTED PRO HAC VICE

Ethan Preston (IL 6278271 )

TO BE ADMITTED PRO HAC VICE

KAMBER & ASSOCIATES, LLC

19 Fulton Street, Suite 400

New York, NY 10038

Telephone: (877) 773-5469

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