Man Barred From Facebook After Allegedly Creating Multiple Fake Accounts to Run Ads

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Jan. 12 — A man accused of fraudulently obtaining an advertising credit line on Facebook and ordering $340,000 worth of deceptive and sexually provocative advertisements on the social networking site without payment is permanently barred from using any Facebook Inc. service, the U.S. District Court for the Northern District of California ruled Jan. 8.

Facebook won a default judgment against Martin Grunin, whom the company accused of fraud, breach of contract and violating the Computer Fraud and Abuse Act, 18 U.S.C. § 1030 et seq., and its California counterpart.

Facebook said Grunin sent e-mails to the social networking company using the fake name “Kayla Stewart” and purported advertising company Thinkmodo, which resulted in him running about $40,000 worth of deceptive advertisements. The suit also alleged that Grunin, communicating with Facebook using three fake names in e-mails and a sham company called Imprezzio Marketing, obtained an advertising credit line from Facebook and ran approximately $300,000 worth of ads.

The court ruled that Grunin's alleged misrepresentations of himself sufficiently stated a fraud claim and that the violations of Facebook's terms of use established a breach of contract claim.

Computer Fraud and Abuse Act

The court said several rulings from the Northern District of California have found defendants liable under the CFAA for circumventing technical barriers placed by Facebook meant to block their access.

After “Grunin’s access was terminated and after he received two cease-and-desist letters, Grunin intentionally accessed Facebook’s computers and servers to obtain account credentials, Facebook credit lines, Facebook ads, and other information, causing more than $5,000 in losses to Facebook,” the court said, referencing the requirement under the CFAA that a defendant cause more than $5,000 in damages. “Grunin intentionally circumvented Facebook’s technical measures by impersonating others to obtain Facebook accounts to run ads which were never paid for,” the court adding, concluding there was a CFAA violation.

The court enjoined Grunin from using any Facebook service and ordered the parties to brief it on the appropriate level of damages and fees. The court also referred the matter to the local U.S. Attorney for consideration and possible investigation. Criminal prosecutions may be brought under the CFAA and its California counterpart.

Grunin proceeded pro se. Perkins Coie LLP represented Facebook.

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