A Sioux Falls business and a California company are in a legal face-off over unsolicited emails.
Gage E-Services of Sioux Falls threatened legal action against Palo Alto-based Knowledge Matrix Inc. this summer after the latter company sent a spam email to Gage co-founder Matt Gage.
Gage sent a letter demanding $750 for violating a 2007 state law that says marketers can only send unsolicited messages to email address of people with whom the marketer has a relationship.
The letter indicated that Gage would sue unless the sum was paid, the Argus Leader reported (http://bit.ly/p9uxqv ).
Court documents filed Friday by Knowledge Matrix in U.S. District Court in South Dakota ask that a federal judge bar Gage from taking legal action. The filing says that the 2003 federal CAN-SPAM Act pre-empts state laws on commercial emails. Additionally, it claims that the email from Knowledge Matrix was not false, misleading or in violation of the law.
Gage also filed a lawsuit in Minnehaha County earlier this month demanding damages from a Colorado-based company for sending sales messages.
Patrick Glover, the Sioux Falls lawyer representing Gage in that suit, has said that Gage is trying to teach out-of-state companies how to conduct business in South Dakota.
"Gage is doing this for everybody," Glover told the Argus Leader.
South Dakota's statute says that a person's email address cannot have been collected in an automated way or bought from a company that uses automation. The subject line of such emails must indicate it's an advertisement. But Glover acknowledged that it isn't clear whether the federal act trumps state laws passed its 2003 creation.
Jon Arneson, a Sioux Falls lawyer representing Knowledge Matrix, declined to comment to the Argus Leader because of the ongoing litigation, the newspaper reported.
"This is really a debate about whether what we're dealing with is free speech or harassment," said Joel Dykstra, the former South Dakota lawmaker who pushed the state's 2007 anti-spam bill.
Since then, he noted, the landscape of electronic marketing has changed even further thanks to Twitter, Facebook and other social media sites.
"It's probably high time for another legislator to review this and consider how things have changed," said Dykstra, a Republican from Canton.
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Information from: Argus Leader, http://www.argusleader.com