The Federal Trade Commission (FTC) has sued seven adult companies for violating federal laws requiring warning labels on emails that contain sexually explicit content.
Four of the companies settled, with the FTC reaping a total of $1.159 million in civil penalties. Settling were BangBros.com Inc., which will pay $650,000; MD Media, the parent company of Pimproll, which will pay $238,743; APC Entertainment Inc., the parent company of Adult Players Club, which will pay $220,000; and Pure Marketing Solutions, LLC, and Internet Matrix Technology, who will together pay $50,000. As part of the settlements, the FTC will be allowed to monitor the defendants’ compliance with the orders.
Meanwhile, three companies have refused to settle and the Department of Justice (DOJ) has filed suit against them on behalf of the FTC for violating the CAN-SPAM Act and the Adult Labeling Rule. The companies are TJ Web Productions LLC, the parent company of Adult PayMaster; Cyberheat Inc., the parent company of TopBucks; and Impulse Media, the parent company of Soulcash.
“This x-rated email is electronic flashing. It exposes kids and other unwary consumers to graphic sexual content, and it is unwanted, offensive, and illegal,” says Lydia Parnes, director of the Bureau of Consumer Protection.“The Adult Labeling Rule was designed to protect consumers who don’t want to be exposed to random assaults of sexual material and others, like kids, for whom it is inappropriate. It’s the law, and we intend to enforce it.”
That may well be the case, but Cyberheat, for one, is vehemently denying any wrongdoing.
“The FTC’s complaint is trying to make us, as an affiliate program, liable for our webmasters’ actions. We feel we’ve done our due diligence to prevent webmasters from violating CAN-SPAM and other laws,” says Alison Vivas, TopBucks vice president of operations.
“We don’t tolerate webmasters who violate the law, and we intend to fight these accusations because it’s ridiculous to be expected to police every webmaster when we have no control over their actions,” she continues.
TopBucks policy is to terminate the account, without pay, of any webmaster caught violating CAN-SPAM. TopBucks has approximately 8000 active affiliates and 35,000 overall, according to Vivas.
TJ Web Productions declined to comment on the lawsuit and representatives of Impulse Media referred AVNOnline.com to their attorney, Rob Apgood, who also represents CyberHeat.
"Obviously [the government doesn't understand] or if they do, they're disregarding that understanding," Apgood said. "Both companies deny the allegations in the complaint and will vigorously defend against those claims. They just flatly didn't do it."
The FTC, in its release, appears unconcerned that that the defendants didn’t actually send the emails that violated CAN-SPAM, stating, “While the defendants did not send email directly to consumers, they operated affiliate marketing programs in which they paid others to send spam on their behalf. Under the CAN-SPAM Act, the defendants are liable for the illegal spam sent by their affiliates because the defendants initiated the email by paying others to send it on their behalf.”
