California Federal Court Dismisses in Part Plaintiff’s Claims Against Emailer Arising under California’s Email Law

On June 18, 2013 in a case arising under California’s Commercial Email Law (“CEL”; Business and Profession Code §17529.5), Moreland v. Ad Optimizers LLC, et al., Case No.: 5:13-CV-00216-PSG, a federal court in the Northern District of California dismissed in part Moreland’s second amended complaint against an emailer where he failed to plead fraud with particularity as required by the Federal Rules of Civil Procedure 9(b).  The court noted the lack of specifics alleged such as the types of allegedly false or misleading advertisements, the number of advertisements or the date ranges of the emails in each category of alleged wrong.  The court further noted that Moreland did not allege the domain names for the landing sites to which the emails redirected, who those sites were registered to, any of the allegedly unlawful subject lines or the sender of any of the emails.

While the court was prepared to dismiss plaintiff’s claims on this ground alone, it nonetheless addressed Moreland’s two other arguments.  The court said that plaintiff’s conspiracy claim against defendant Lopez – an owner of co-defendant Ad Optimizers – was barred by California’s Agent’s Immunity Rule, which bars a claim that an agent of a corporation conspired with its corporate principal where it acts in an official capacity on behalf of the corporation and not for individual advantage.   It also barred Moreland’s claim that Lopez also conspired with at least one unnamed third party.

However, the court rejected Lopez’ argument that he was not liable under the CEL, where Lopez argued the law applied only to advertisers and not those who create and send third-party email advertisements.  In support of this position, Lopez pointed to the difference between the use of “advertiser and initiator” language in §17529.4 and §17529.6 and the solitary “advertiser” language in §17529.5.  The court referenced past interpretation by California courts to reject the contention.

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