Hotmail Corporation provides a free email
service. In order to access this service, you have to become a subscriber
to Hotmail which requires you to assent to the terms of a Service Agreement.
The Terms of Service contained in this Agreement specifically prohibit
subscribers from using Hotmail's services to send unsolicited commercial
bulk e-mail or "spam," or to send obscene or pornographic messages.
Hotmail is entitled to terminate the account of any Hotmail subscriber
who violates the Terms of Service. The Terms of Service are presented
in the form of a clickwrap agreement.
The defendant in this case was a spammer who
had sent spam to thousands of email addresses and had set up numerous Hotmail
accounts to facilitate their operations by using them as a "drop box" (i.e.
an email account to which responses to their original messages were sent,
but whose contents were never opened, read or responded to). As a
result of this, Hotmail was inundated with hundreds of thousands of misdirected
responses, as well as complaints from Hotmail subscribers regarding the
spam. This seriously affected Hotmail's finite computer capacity,
causing significant delay and costs in terms of increased personnel necessary
to deal with the complaints and problems created by the spam. Hotmail
thus sought a preliminary injunction preventing the defendant from using
its email services in the future. The District Court granted this
noting that 'the evidence supports a finding that the plaintiff will likely
prevail on its breach of contract claim and that there are at least serious
questions going to the merits of this claim'.
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