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2 found guilty in nation's 1st felony spam conviction

By The Associated Press
11.04.04

LEESBURG, Va. — A brother and sister who sent junk e-mail to millions of America Online customers were convicted yesterday in the nation’s first felony prosecution of Internet spam distributors.

Jurors recommended that Jeremy Jaynes, 30, be sentenced to nine years in prison and fined Jessica DeGroot, 28, $7,500 after convicting them of three counts each of sending e-mails with fraudulent and untraceable routing information.

A third defendant, Richard Rutkowski, 30, was acquitted after deliberations of 1 ½ days. All three defendants live in the Raleigh, N.C., area.

Virginia prosecuted the case under a law that took effect last year that bars people from sending bulk e-mail that is unsolicited and masks its origin. The defendants have said the law is an unconstitutional infringement of free speech.

Prosecutors compared Jaynes and DeGroot to modern-day snake oil salesmen who use the Internet to peddle junk like a “FedEx refund processor” that supposedly allowed people to earn $75 an hour working from home.

In one month alone, Jaynes received 10,000 credit card orders, each for $39.95, for the processor.

“This was just a case of fraud,” said prosecutor Gene Fishel. “This is a snake oil salesman in a new format.”

Prosecutor Russell McGuire said Jaynes amassed a net wealth of $24 million peddling worthless products like the refund processor and other products like a “penny stock picker” and an Internet history eraser.

“He’s been successful ripping people off all these years,” McGuire said.

Prosecutors had asked the jury to impose a maximum sentence of 15 years in prison for Jaynes, and to consider some amount of jail time for his sister, whom they acknowledged was less culpabale.

Defense lawyers asked jurors to spare the defendants prison terms.

David Oblon, representing Jaynes, argued that it was inappropriate for prosecutors to seek what he called an excessive punishment, given that this is the first prosecution under the Virginia law. He also noted that his client, a North Carolina resident, would have been unaware of the Virginia law.

Oblon called the jury’s recommendation of nine years in prison shocking.

“Nine years is absolutely outrageous when you look at what we do to people convicted of crimes like robbery and rape,” Oblon said.

When Jaynes and DeGroot are formally sentenced in February, Circuit Court Judge Thomas Horne will have the option of reducing the jury’s sentence or leaving it intact. He cannot increase it.

Horne also has not yet ruled on an earlier motion asking that the cases be dismissed. He said during the trial that he had a hard time allowing the prosecution of DeGroot and Rutkowski to go forward to the jury.

The attorney Oblon said Jaynes “is convinced of his innocence” and he expects the conviction will eventually be set aside.

Even if Horne refuses to set aside the verdict, Oblon can appeal and challenge the new law on constitutional grounds.

Numerous AOL employees testified during the two-week trial, and Oblon complained that prosecutors often seemed to be prosecuting the case at AOL’s bidding. He noted that Virginia Attorney General Jerry Kilgore announced indictments in the case last year at a press conference at AOL’s Dulles, Va., headquarters.

“It appears at times that AOL was basically taking over the criminal prosecution,” Oblon said.

AOL is a unit of New York-based Time Warner Inc.

Attorney General Jerry W. Kilgore called Virginia’s anti-spam law the toughest in America.

“Spam is a nuisance to millions of Americans, but it is also a major problem for businesses large and small because the thousands of unwanted e-mails create havoc as they attempt to conduct business,” Kilgore said in a statement.


Update
Va. appeals court upholds mega-spammer's conviction
Judges find state has 'legitimate public interest' in policing unsolicited e-mail, law's impact on interstate commerce 'is incidental and clearly not excessive.' 09.06.06

Related

Virginia aims to short-circuit spam with tough new law

Statute allows authorities to seize assets earned from sending bulk unsolicited e-mail, imposes sentences of up to five years in prison. 05.01.03

FTC wins round in battle against X-rated spammers
Granting agency's request, federal judge extends preliminary injunction barring six businesses from sending sexually explicit e-mail. 01.12.05

Spam

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