Texas’ Attorney General sued in federal court on Monday trying to stop and impose civil penalties against two individuals who allegedly sent unsolicited email worldwide through their companies PayPerAction and LeadPlex. The Texas AG charges that the two individuals used as many as 250 assumed business names to send emails with misleading subject lines; under  the CAN-SPAM Act the subject line must clearly indicate that the email is an advertisement. CAN-SPAM doesn’t prohibit sending advertising email but it requires it to confirm to some specific requirements, among which is that the subject line clearly identify that the contents is commercial, that there be no misleading or fraudulent content, among others.

A wrinkle in the case is that both individuals sold their interest in their companies in March to a Hong-Kong based company. The HK company is also named in the suit, although it is not clear whether it is subject to jurisdiction in Texas an whether the company plans to appear at all.

In addition to CAN-SPAM, Texas’ AG seeks damages under the Texas Electronic Mail Solicitation Act and the Texas Deceptive Trade Practices Act. Total damages, based on more than 24,000 e-mails collected as evidence and potential penalties of more than $20,000 for each violation, could reach almost $500 million.