Schaffer and Kilbride represent the first convictions in the jurisdiction of the 9th U.S. Circuit Court of Appeals for Internet obscenity not involving child pornography and the first convictions ever under the CAN-SPAM Act.
The appeal challenges, among other things, the lower court’s instructions to the jury on obscenity charges that allowed the jury to consider evidence from jurisdictions outside their own community.
“The Miller test’s requirement that juries apply “local community standards” in deciding whether materials are obscene, is outdated and simply cannot be applied to Internet communications,” said attorney Greg Piccionelli of Piccionelli & Sarno. “The [judge] recognized this and attempted to craft a workable community standards instruction.
“[But] his attempt, while well-intentioned, resulted in an unprecedented hybrid instruction that combined local and non-local community standards and allowed the jury to decide for themselves which standards to apply.”
Gary Jay Kaufman of the Kaufman Law Group said further exacerbating the instruction’s unconstitutionality, the lower court permitted the government to bring in witnesses from all over the country and testify that they were “offended” by the images.
“The fact that lay witnesses were permitted to testify as to their opinion of the images was truly unbelievable and by itself constitutes grounds for reversal; their opinions were completely irrelevant,” Kaufman said. “Combine that with the fact that the jury was allowed to consider evidence from other jurisdictions and there is no doubt that this instruction was erroneous.
“If that instruction were allowed to stand, then the most puritanical community’s standards would govern what is or is not considered obscene.”
Kilbride of Venice, Calif., was sentenced to more than six years and Schaffer of Paradise Valley, Ariz., was sentenced to more than five years in prison after they were found guilty of embedding hardcore porn in mass emails.
Kilbride and Schaffer began their spamming operation in 2003, using international servers and mismatching "reply to" and "from" addresses, making it difficult to trace the spam emails.
The Justice Department said they registered their domains under the name of a "fictitious employee at a shell corporation" and that the two had set up in the Republic of Mauritius, another CAN-SPAM violation.
They also are alleged to have used overseas banks to launder and hide money from the IRS.
Schaffer also was charged with 2257 violations, after the Justice Department discovered he had not maintained appropriate records for the adult performers featured on Boobs.com, CumShots.com and FaceSat.com, three websites he operated overseas through The Compliance Company and Ganymede Marketing.
Kilbride and Schaffer initially were charged in 2005. They both were granted bail pending appeal in November.
With the convictions, both were fined $100,000 and forced to hand over $1.1 million of their $2 million in spam profit.
They also were ordered to pay America Online $77,500 after the conglomerate claimed to have had 1.5 million customers complain about spam.
"Everyone in the industry should pay attention to this case,” Kaufman said earlier this year. “I could walk by any booth at the upcoming AVN expo and find material that pushes the obscenity envelope to a similar, or even greater, degree than the ones that got our clients convicted.”