Internet Library of Law
and Court Decisions

Affiliates - Internet Library of Law and Court Decisions - Updated April 12, 2007

Court denies summary judgment motion by Lands' End "affiliates," seeking dismissal of claims arising out of affiliates' undisclosed use of typo domains to redirect traffic to Lands' End's website, and to profit on the sales made to consumers delivered to Lands' End's site in this fashion.  As affiliates, defendants received a percentage of sales made by Lands' End to consumers they brought to Lands' End's website.  The Court accordingly allowed plaintiff to proceed with claims that defendants' conduct violated the Anticybersquatting Consumer Protection Act ("ACPA") and breached the parties' affiliate agreements.  The Court also allowed plaintiff to pursue fraud claims arising out of defendants' concealment of this use of Lands' End typo domains.  The Court did grant so much of the defendants' summary judgment motion which sought dismissal of false advertising claims plaintiff advanced under both the Lanham Act and Wisconsin state law, holding that defendants did not mislead consumers by their conduct.  Consumers were unaware of the redirection, and received exactly what they expected to receive - Lands' End merchandise from Lands' End.

Denying cross-motions for summary judgment, the Court allows the Government to pursue civil claims against defendant Cyberheat Inc. ("Cyberheat") for violation of the CAN-SPAM Act arising out of the transmission of sexually explicit emails by its affiliates that did not meet the strictures of the Act.  While Cyberheat did not directly pay its affiliates to transmit such emails, it paid them "finder's fees" for subscribers their promotional activities produced - including subscribers produced by email - and provided affiliates with promotional materials that could be used - via links - in promotional emails.  The court held that questions of fact as to defendant's knowledge of its affiliates' activities, and the steps defendant could or did take to prevent violations of the Act after it became aware of consumer complaints, prevented the court from determining whether Cyberheat should be held either vicariously liable for the acts of its affiliates, or to have initiated or procured the transmission of the offending emails within the meaning of the CAN-SPAM Act.   The court reached this result notwithstanding the fact that Cyberheat's contracts with its affiliates contained explicit prohibitions against the transmission of emails that violate CAN-SPAM.

The court held that because it was in the business of sending sexually explicit materials over the Internet, defendant owed a duty to the public to exercise reasonable care to prevent those who did not wish to see such materials from being involuntarily exposed to such uninvited intrusions.  The question of whether defendant Cyberheat met this duty was left for another day.