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How A Late Night Email Could Put You In Jail

Posted in Commentary, Employment, Litigation, News, Recent Law Trends, Vendors

Email Unlocked

No matter what industry you are in, many of us are responsible for hundreds of emails per day. Each of those emails can become permanent records of what you are thinking, doing, or planning. Email errors can sometimes cause only minor disagreements, for which you can apologize and move on. However, in the most severe instances, those misguided emails can cost you thousands of dollars or even jail time.

This post shows one of the most egregious cases of email judgment error, and it provides some helpful hints at preventing it.

Email Judgment Error: Steve Warshak*

Many of us have seen the cheesy “Smilin’ Bob” commercials for the product Enzyte, which peaked at sales of over $100 million in 2004. What many don’t know is that the original founder of the company that previously sold Enzyte, Steve Warshak, is currently serving a 25 year sentence in federal prison. Warshak sent an email in the middle of the night praising his nephew, Jason, for a bong-induced scheme to defraud Enzyte users, and it was the key piece of evidence used at his trial.

Much of Enzyte’s success came from the Smilin’ Bob commercial campaign. However, it also came from a “continuity” program. Continuity programs are basically contracts allowing a company to continue to charge for products until you cancel. In Enzyte’s case, the product was initially free, and if you called and canceled in certain amount of time, your subscription for Enzyte would end.

As long as all of the terms are disclosed up front, there is nothing inherently illegal about continuity programs. In fact, more than one million people successfully canceled their Enzyte subscriptions without entering the program. Yet, Warshak was still sentenced to 25 years in prison, in large part due to the praise of his nephew’s email.

His nephew’s plan was to call Enzyte users who canceled their subscriptions and offer them a product supposedly promoted by a hospital, which was false. In forwarding the plan to other executives, Warshak’s email said: “the student has become the teacher – our company was built on this kind of creative thinking . . . Thanks for the wake-up call jason!”

The problem with this email is that endorses a fraudulent program. The nephew’s program to falsify a hospital promotion is patently fraudulent, and Warshak’s endorsement, if not instructions, to implement it, could be considered an admission of guilt. Without this email, there was little that directly tied Warshak to some of the more shady practices of Enzyte, and the prosecution used it to elicit a 25 year sentence.

Warshak’s excuse? He sent the email at 1:24 a.m. without thinking.

How To Reduce Liability Risks In Email

Steve Warshaks’ story has many lessons. The first is don’t promote patently fraudulent programs.  The second is to use caution when writing emails, as they are a breadcrumb trail that can lead back to you.

Aside from these more obvious lessons, I recommend implementing the following practices to reduce email liability:

1. Reduce Your Email. In this Blackberry-crazed world, many of us think we have to be connected all the time and wonder what we used to do before email. I suggest (and statistics should show) that the fewer emails you send, the less chance you have of saying something damning. Therefore, really consider whether or not a response is necessary before you send an email. For some terrific suggestions on reducing emails, consider reading The 4-Hour Work Week, by Tim Ferris.

2. Pretend Your Email Will Be Published On CNN. This works very well for me personally. Before I send an email, I consider what the worst thing that could happen from this email if it were posted on CNN. This reduces quite a bit of my email. It’s a good idea because your email very well might end up there one day.

3. Implement An Email Deletion Policy. Having a policy where your computer automatically deletes sent email can help because (if done correctly) it should wipe at least your own record of emails to keep them from being used against you. Of course, this doesn’t help if the other party who receives your email doesn’t do the same thing, but it’s a step in the right direction.

4. Don’t Send Late Night Emails Or Emails On The Fly. Again, with mobile devices like Blackberry’s it is far too easy to shoot from the hip and send an email that you might regret. I now use my Blackberry primarily for reading email, unless it is absolutely necessary to send a response. Even then, I keep it short, and if a lengthy response is required, I write it when I can sit down and really consider a response.

5. Don’t Send Personal Emails On Work Email Accounts. There are many court cases that have ruled that you have no expectation of privacy over your work email. Therefore, you should assume that your company reads all of your email and that when you leave the company, they will keep your email and/or read it then. Therefore, leave personal emails to personal email accounts. The same applies to work phones and Blackberrys. If you think your company does not read your text messages on phones that they issue, think again.

Conclusion

Steve Warshak learned his lesson the hard way. He lost his personal fortune and is serving jail time. Hopefully, his story and the tips above will keep the same thing from happening to you.

* All references related to Steve Warshak and/or Enzyte came from an article in the October 2009 edition of Gentleman’s Quarterly written by Amy Wallace.