State v. Heckel

• Decision Date: 07 June 2001
• Docket Number: No. 69416-8.,69416-8.
• Parties: STATE of Washington, Appellant, v. Jason HECKEL, doing business as Natural Instincts, Respondent.
• Court: Washington Supreme Court

24 P.3d 404

143 Wash.2d 824

STATE of Washington, Appellant, v. Jason HECKEL, doing business as Natural Instincts, Respondent.

No. 69416-8.

Supreme Court of Washington, En Banc.

Argued March 20, 2001.

Decided June 7, 2001.

Honorable Christine Gregoire, Attorney General, Paula Lillian Selis, Helen Regina Cullen, W. Stuart Hirshfeld, Assts., Seattle, Jay Douglas Geck, Asst., Olympia, for Appellant.

Van Siclen & Stocks, Robert Craig Van Siclen, Auburn, Dale L. Crandall, Charese Rhony, Salem, for Respondent.

Miller, Nash, Brian William Esler, Richard J. Busch, Seattle, Amicus Curiae on Behalf of Washington Association of Internet Service Providers.

OWENS, J.

The State of Washington filed suit against Oregon resident Jason Heckel, alleging that his transmissions of electronic mail (e-mail) to Washington residents violated Washington's commercial electronic mail act, chapter 19.190 RCW (the Act). On cross-motions for summary judgment, the trial court dismissed the State's suit against Heckel, concluding that the Act violated the dormant Commerce Clause of the United States Constitution. This court granted the State's request for direct review. We hold that the Act does not unduly burden interstate commerce. We reverse the trial court's dismissal of the State's suit, vacate the order on attorney fees, and remand this matter for trial.

FACTS

As early as February 1996, defendant Jason Heckel, an Oregon resident doing business as Natural Instincts, began sending unsolicited commercial e-mail (UCE), or "spam," over the Internet.¹ In 1997, Heckel developed a 46 page on-line booklet entitled "How to Profit from the Internet." The booklet described how to set up an on-line promotional business, acquire free e-mail accounts, and obtain software for sending bulk e-mail. From June 1998, Heckel marketed the booklet by sending between 100,000 and 1,000,000 UCE messages per week. To acquire the large volume of e-mail addresses,² Heckel used the Extractor Pro software program, which harvests e-mail addresses from various on-line sources and enables a spammer to direct a bulk-mail message to those addresses by entering a simple command. The Extractor Pro program requires the spammer to enter a return e-mail address, a subject line,³ and the text of the message to be sent. The text of Heckel's UCE was a lengthy sales pitch that included testimonials from satisfied purchasers and culminated in an order form that the recipient could download and print. The order form included the Salem, Oregon, mailing address for Natural Instincts. Charging $39.95 for the booklet, Heckel made 30 to 50 sales per month.

In June 1998, the Consumer Protection Division of the Washington State Attorney General's Office received complaints from Washington recipients of Heckel's UCE messages. The complaints alleged that Heckel's messages contained misleading subject lines and false transmission paths.⁴ Responding to the June complaints, David Hill, an inspector from the Consumer Protection Division, sent Heckel a letter advising him of the existence of the Act. The Act provides that anyone sending a commercial e-mail message from a computer located in Washington or to an e-mail address held by a Washington resident may not use a third-party's domain name without permission,⁵ misrepresent or disguise in any other way the message's point of origin or transmission path, or use a misleading subject line.⁶ RCW 19.190.030 makes a violation of the Act a per se violation of the Consumer Protection Act, chapter 19.86 RCW (CPA).

Responding to Hill's letter, Heckel telephoned Hill on or around June 25, 1998. According to Hill, he discussed with Heckel the provisions of the Act and the procedures bulk e-mailers can follow to identify e-mail addressees who are Washington residents. Nevertheless, the Attorney General's Office continued to receive consumer complaints alleging that Heckel's bulk e-mailings from Natural Instincts appeared to contain misleading subject lines, false or unusable return e-mail addresses, and false or misleading transmission paths. Between June and September 1998, the Consumer Protection Division of the Attorney General's Office documented 20 complaints from 17 recipients of Heckel's UCE messages.

On October 22, 1998, the State filed suit against Heckel, stating three causes of action. First, the State alleged that Heckel had violated RCW 19.190.020(1)(b) and, in turn, the CPA, by using false or misleading information in the subject line of his UCE messages. Heckel used one of two subject lines to introduce his solicitations: "Did I get the right e-mail address?" and "For your review—HANDS OFF!" Clerk's Papers (CP) at 6, 92, 113. In the State's view, the first subject line falsely suggested that an acquaintance of the recipient was trying to make contact, while the second subject line invited the misperception that the message contained classified information for the particular recipient's review.

As its second cause of action, the State alleged that Heckel had violated RCW 19.190.020(1)(a), and thus the CPA, by misrepresenting information defining the transmission paths of his UCE messages. Heckel routed his spam through at least a dozen different domain names without receiving permission to do so from the registered owners of those names. For example, of the 20 complaints the Attorney General's Office received concerning Heckel's spam, 9 of the messages showed "13.com" as the initial ISP to transmit his spam. CP at 44, 113. The 13.com domain name, however, was registered as early as November 1995 to another individual, from whom Heckel had not sought or received permission to use the registered name. In fact, because the owner of 13.com had not yet even activated that domain name, no messages could have been sent or received through 13.com.

Additionally, the State alleged that Heckel had violated the CPA by failing to provide a valid return e-mail address to which bulk-mail recipients could respond. When Heckel created his spam with the Extractor Pro software, he used at least a dozen different return e-mail addresses with the domain name "juno.com" (Heckel used the Juno accounts in part because they were free). CP at 88-89. None of the Juno e-mail accounts was readily identifiable as belonging to Heckel; the user names that he registered generally consisted of a name or a name plus a number (e.g., "marlin1374," "cindyt5667," "howardwesley13," "johnjacobson1374," and "sjtowns"). CP at 88-89. During August and September 1998, Heckel's Juno addresses were canceled within two days of his sending out a bulk e-mail message on the account. According to Heckel, when Juno canceled one e-mail account, he would simply open a new one and send out another bulk mailing. Because Heckel's accounts were canceled so rapidly, recipients who attempted to reply were unsuccessful. The State thus contended that Heckel's practice of cycling through e-mail addresses ensured that those addresses were useless to the recipients of his UCE messages.⁷ During the months that Heckel was sending out bulk e-mail solicitations on the Juno accounts, he maintained a personal e-mail account from which he sent no spam, but that e-mail address was not included in any of his spam messages. The State asserted that Heckel's use of such ephemeral e-mail addresses in his UCE amounted to a deceptive practice in violation of RCW 19.86.020.

The State sought a permanent injunction and, pursuant to RCW 19.86.140 and .080 of the CPA, requested civil penalties, as well as costs and a reasonable attorney fee. In early 2000, the parties cross-moved for summary judgment. On March 10, 2000, the trial court entered an order granting Heckel's motion and denying the State's cross motion. The court found that the Act violated the Commerce Clause (U.S. CONST. art. I, § 8, cl. 3) and was "unduly restrictive and burdensome." CP at 175. The order permitted Heckel to "present a cost bill for recovery of his costs and statutory attorneys fees." CP at 175. Heckel then moved the court for a fee award of $49,897.50. Denying Heckel's request for fees under RCW 19.86.080 of the CPA, the court limited Heckel's award to statutory costs under RCW 4.84.030.

Challenging the trial court's finding that the Act violated the Commerce Clause, the State sought this court's direct review. Heckel cross-appealed, seeking reversal of the trial court's denial of his attorney fee request under the CPA. We granted direct review.

ISSUE

Does the Act, which prohibits misrepresentation in the subject line or transmission path of any commercial e-mail message sent to Washington residents or from a Washington computer, unconstitutionally burden interstate commerce?

ANALYSIS

Standard of Review. The State seeks review of the trial court's decision on summary judgment that the Act violated the dormant Commerce Clause. This court reviews de novo a trial court's grant of summary judgment and views all facts in the light most favorable to the party challenging the summary dismissal. Lybbert v. Grant County, 141 Wash.2d 29, 34, 1 P.3d 1124 (2000). A legislative act is presumptively constitutional, "and the party challenging it bears the burden of proving it unconstitutional beyond a reasonable doubt." State v. Brayman, 110 Wash.2d 183, 193, 751 P.2d 294 (1988); see also Frach v. Schoettler, 46 Wash.2d 281, 280 P.2d 1038,

cert. denied, 350 U.S. 838, 76 S.Ct. 75, 100 L.Ed. 747 (1955). A party meets the standard "if argument and research show that there is no reasonable doubt that the statute violates the constitution." Amalgamated Transit Union Local 587 v. State, 142 Wash.2d 183, 205, 11 P.3d 762 (2000) (citing Belas v. Kiga, 135 Wash.2d 913, 920, 959 P.2d 1037 (1998)).

Heckel's Challenge under the Commerce Clause. The Commerce Clause grants Congress the "power ... [t]o regulate commerce with foreign nations, and among the several states." U.S. CONST. art. I, § 8, cl. 3. Implicit in this affirmative grant is the...