Texas AG Takes On Spam Factory

DALLAS An Austin direct-response marketer named by Texas Attorney General Gregg Abbott as “one of the world’s worst spam operations” promoted itself as “the aggregate leader at the forefront of the wireless revolution.”

“LeadPlex will be the primary online resource to develop and manage campaigns, set trends, drive growth and efficiently and cost-effectively achieve accurate, measurable results,” the company wrote in the vision statement on its Web site.

Instead, Abbott said, LeadPlex’s controlling partners—under a variety of corporate names—violated state and federal laws banning deceptive, unsolicited e-mail.

Ryan Samuel Pitylak, a University of Texas at Austin student, and Mark Stephen Trotter of California are named in Abbott’s federal lawsuit as controlling PayPerAction LLC, Leadplex LLC and Leadplex Inc., three companies registered in Nevada. SpamHaus.org, a watchdog group, ranks the defendants as the fourth-largest illegal spam operation in the world, according to Abbott.

“Texans are fed up, and today’s action aims to give them relief by shutting down one of the world’s worst spam operations,” Abbott said at a Houston press conference Thursday.

Since Pitylak and Trotter established PayPerAction in 2002, it has operated more than 250 assumed names, leading Internet users to believe different companies promoting products and services are deluging them, Abbott said.

LeadPlex describes its marketing approach as “aggressive but consummately professional.” Pitylak and Trotter could not be reached for comment on the lawsuit.

Abbott’s lawsuit was filed under the federal Controlling the Assault of Non-Solicited Pornography and Marketing Act of 2003 (CAN-SPAM), which carries penalties of $250 per violation, up to $2 million. Abbott is also alleging violations of the Texas Electronic Mail and Solicitation Act, which allows for penalties of up to $10 per unlawful e-mail or $25,000 per day, and the Texas Deceptive Trade Practices Act, which authorizes penalties of up to $20,000 per violation.

“The defendants engaged in the common but illegal practice of using misleading subject lines that give recipients the false impression the e-mail contains information specific to them,” Abbott said. “By law, such promotional e-mails must clearly indicate they are advertisements and cannot use misleading subject lines to trick recipients into opening them.”

When opened, most of the e-mails collected by users cooperating with the AG’s office contained hyped-up language pitching mortgage refinancing services, even though the defendants are not licensed in Texas to provide such services, Abbott said. Consumers sometimes responded to the e-mails by providing additional information after being told their privacy would be protected. Instead, Abbott said, the defendants sold the information as sales leads to other companies for as much as $28 per lead.