Microsoft Corp. said on Tuesday that it had settled a lawsuit against Scott Richter, whom it identified as a former "spam king."
Microsoft said that as part of the settlement Richter and his company agreed to pay $7 million to Microsoft.
Richter and his company will file a motion on Tuesday to dismiss bankruptcy proceedings they filed in March in the U.S. bankruptcy court in Denver, according to a joint statement by Microsoft and Richter. Bankruptcy was originally filed to avoid paying Microsoft's judgment.
The settlement is conditioned on dismissal of the bankruptcy cases.
A separate statement from Microsoft senior vice president and general counsel Brad Smith said the company will reinvest all of the money including $5 million additional of their own money which will go to increase Internet enforcement efforts and expand technical and investigative support to help law enforcers to address computer- related crimes. Smith said "we intend to begin catching and punishing spammers; deterence rather than filtering from now on."
The joint statement from Microsoft and Richter said Richter had changed his e-mailing practices in part because Microsoft and the office of New York Attorney General Eliot Spitzer sued him in 2003.
In its lawsuit, Microsoft argued that Richter and his companies violated state and federal law by sending spam e-mail and teaching other guys how to do the same, to send spam.
In the statement, Richter and his company, OptInRealBig.Com, LLC, denied all allegations.
Copyright 2005 Reuters Limited. All rights reserved. Republication or redistribution of Reuters content is expressly prohibited without the prior written consent of Reuters. Reuters shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.