MySpace recently settled an anti-spam lawsuit brought against TheGlobe.com for $2.55 million. TheGlobe appears to have used the mass marketing as a last gasp attempt to survive bankruptcy, according to its recent corporate reports.
Bulk marketing practices are often seen as last ditch attempts by failing companies to right the ship. Another circumstance that tends to breed bulk marketing campaigns are IPOs when the newly public company hopes to inflate the IPO offering by showing a surge in sales. One recent example of this practice was Vonage, which launched a huge bulk fax campaign just before its IPO. Vonage has since been hit by numerous TCPA suits in addition to its patent litigation woes.
Bottom Line: TheGlobe appears to have hurt itself more than help itself by incurring a $2.55 million loss for illegal marketing practices. One can only hope that the company will be able to right itself without incurring additional liability for such practices.