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New Federal Anti-Spam Law Applies to Senders of Commercial Email Messages

NAW Legal Advisory - December 2003

On December 16, 2003, the President signed the CAN-SPAM Act of 2003 (S.877, Pub. Law 108-187) into law, to go into effect on January 1, 2004. The law sets rules for senders of "commercial electronic mail messages." This federal law preempts all existing state laws expressly regulating the use of email to send commercial messages, including the new California law scheduled to go into effect in 2004. A general summary of the Act's civil provisions applicable to commercial email messages is provided below. The entire Act may be viewed at:
http://frwebgate.access.gpo.gov/cgi-bin/getdoc.cgi?dbname=108_cong_bills&docid=f:s877enr.txt.pdf

A commercial electronic mail message is defined as any electronic mail message whose primary purpose is the commercial advertisement or promotion of a commercial product or service and specifically includes email that promotes content on an Internet website operated for a commercial purpose. The reference in a message to a commercial entity or a link to the website of a commercial entity does not, by itself, cause the message to fall under the definition of a commercial electronic email message if the contents indicate a primary purpose other than an advertisement or promotion of a product or service. The Act provides that the Federal Trade Commission (FTC) shall issue regulations defining criteria that would determine "primary purpose."

The definition of commercial electronic email message goes on to state that the term does not include a transactional or relationship message, which is defined as a message whose primary purpose is to (a) facilitate, complete or confirm a commercial transaction that the recipient has previously agreed to enter into with the sender; (b) provide warranty, product recall or safety information with respect to a commercial product or service used or purchased by the recipient; (c) provide notification concerning a change with respect to a subscription, membership, account or comparable ongoing commercial relationship; (d) provide information directly related to an employment relationship or related benefit plan in which the recipient is currently involved; or (e) deliver goods or services, including product updates or upgrades, that the recipient is entitled to receive under the terms of a transaction that the recipient has previously agreed to enter into with the sender. The FTC may by regulation expand or contract the definition of transactional or relationship messages.


Content of a Commercial Email Message

The Act requires that a commercial email message include a functioning return email address, clearly displayed, so that a recipient may submit a reply requesting not to receive future commercial emails. This email address must remain capable of receiving opt-out messages for at least 30 days after transmission of the original message. The sender must then, within 10 days of receipt of the opt-out message, cease transmission to that recipient of any commercial email messages covered by the opt-out request. Thereafter, the recipient may affirmatively consent to resume receipt of such messages from the sender.

Also, all commercial email messages must include:

  • A clear and conspicuous identification that the message is an advertisement or a solicitation (this is not required if the recipient has given prior affirmative consent to receipt of the message);
  • A clear and conspicuous notice of the opportunity to "opt-out" electronically from future commercial messages; and
  • A valid postal address of the sender.

The law does not specify any required location or format (e.g., type size) for the above information in the email message.

Enforcement and Civil Penalties

The FTC may enforce the Act as if a violation were an unfair or deceptive trade practice proscribed under the FTC Act. State attorneys generals also may enforce the Act's civil provisions and recover statutory damages from the email sender of up to $250 per illegal message, not to exceed $2.0 million. These damages may be tripled for an aggravated violation and a state may also recover its attorneys' fees for a successful action.

An internet service provider adversely affected by unlawful emails may also recover statutory damages from the sender of up to $100 per illegal message, not to exceed $1.0 million. These damages may be tripled for an aggravated violation and the court may award attorneys fees and costs to any party to the action. The Act also contains criminal provisions and penalties (fines and up to 5 years imprisonment) for specific fraudulent email activity.

There is no private right of action granted to a recipient of an illegal email.