SAN FRANCISCO, CA - May 23, 2005 - The Institute for Spam and Internet Public Policy (ISIPP) is advising companies to take the $1.45billion email mismanagement judgement recently announced against Morgan Stanley as a wake-up call.

"For the most part, organizations are very blithe about how they process, retain, and delete email both sent and received by their organization," said Anne P. Mitchell, Esq., President and CEO of the Institute, and a Professor of Law. "In fact, most companies have no email handling and retention policies at all. This is a big mistake, as email is usually one of the first things demanded during a lawsuit. It was exactly this mismanagement of email which lead to the enormous legal judgement against Morgan Stanley this past week."

Last week's judgement against Morgan Stanley involved the financial company's failure to retain and produce email demanded during a lawsuit by billionaire Ronald Perelman, in which Perelman accused Morgan Stanley of deceiving him about a business deal.

"While businesses must, and usually do, have written document retention policies, they often fail to have similar policies relating to email. Yet a great deal of information is both sent and received in email, and copies of email are almost always demanded during the discovery phase of a lawsuit. A court is not going to take kindly to a defendant saying "Oops, it was deleted," explained Mitchell, who said that she knows of several companies which have met similar legal fates where the failure to retain email or other electronic communications has been equated by the court with destruction of evidence.

"Just as importantly," said Mitchell, who teaches Internet Law at Lincoln Law School of San Jose, "companies need to make sure that they have a clear policy in place about the scope of what their employees may discuss electronically during the course of their employment, not just in email, but in Internet forums such as chat rooms, instant messengers, and Usenet. Each piece of email, every little public remark, is a potential smoking gun, just waiting to indict the company from which the message originated."

ISIPP, which is best known for its accreditation services for email senders and marketers, its anti-spam technology for email receivers, and its Spam and the Law conferences, also advises companies on email retention and handling, and Internet public statement policies.

Added Mitchell, who is on the advisory boards of Kinar Secure Email, Relemail Email Privacy Certification, and the Virus Bulletin, "The time to put such a policy in place was yesterday, and certainly today - not once once the lawsuit happens. By that time it is too late."