New York State attorney general Eliot Spitzer announced this week a $50,000 (£27,000) settlement with e-mail marketer Scott Richter and his company, OptInRealBig.com.
Aided by Microsoft Spitzer filed suit in December against Richter, his company and several affiliated partner companies.
Using evidence gathered through Microsoft's Hotmail e-mail service, Spitzer charged the defendants with sending as many as 250 million e-mail messages each day, many containing fraudulent statements such as faked sender identifications and transmission paths. Spitzer sought a penalty of up to $20m in fines.
Spitzer said at the time that his goal was to "change the economics of spam" and bankrupt Richter, who he cited as one of the world's most prolific senders of unsolicited commercial e-mails.
But Richter said the settlement deal negotiated with Spitzer's office would not change his business practices at all, which he contends were always legal.
Richter declined to comment on the volume of e-mail sent daily by his company, but said that all its messages abide by regulations such as the Controlling the Assault of Non-Solicited Pornography and Marketing Act (Can-Spam).
Richter distanced himself from the shady e-mails at issue in the lawsuit, which he characterised as originating from other businesses contracting with OptInRealBig.com.
"We were already following some very strict business practices," he said. "We are very pleased that we were able to reach a settlement."
Spitzer's office is continuing its case against the other defendants charged, which include Synergy 6; Plano, Delta Seven Communications, and its officers. Those companies, Richter, and OptInRealBig.com, remain defendants in a lawsuit filed by Microsoft.
Richter, who cheerfully lays claim to the "Spam King" title, said his lawyers are "working around the clock" to settle the Microsoft case.
Microsoft representative Aaron Kornblum, an attorney with the company's internet safety enforcement group, said Microsoft favours Spitzer's settlement even as it continues to "aggressively pursue" its own case against Richter.
"Microsoft supports the New York attorney general's settlement as it contains strong requirements designed to prevent illegal spamming as well as provisions to help ensure Richter's and his company's future compliance with the law," Kornblum said.
Stacy Cowley writes for IDG News Service