Inside Facebook

Earlier this year, we first covered the news that Facebook had filed a federal lawsuit against famed “Spam King” Sanford Wallace for crimes under the CAN-SPAM Act, Computer Fraud and Abuse Act, and the California Anti-Phishing Act. Today, Facebook says the company won the case and was awarded $711 million in damages, the second largest CAN-SPAM judgment only to Facebook’s $873 million judgment against Adam Guerbuez and Atlantis Blue Capital last November.

“While we don’t expect to quickly collect the full amount, we’ll work hard to get everything we can,” a Facebook spokesperson said. “Most importantly, the judge referred Wallace for prosecution for criminal contempt of court, which means that in addition to the judgment, he now faces possible jail time.  We’re confident that today’s ruling will act as a powerful deterrent against those who would abuse Facebook and its users.”

Wallace used “phishing” techniques to gain unauthorized access to users’ accounts, and then send fake wall posts and messages. He filed for bankruptcy this summer.

This is not the first time Wallace has been found liable for malicious marketing practices on social networks. In May of 2008, MySpace won a $234 million judgment against Wallace and business partner Walter Rines for illegal spam and phishing attacks against MySpace users. Wallace has been actively building his “Spam King” reputation since 1997, having been charged with various federal crimes over the last decade.