The CAN-SPAM Act is the federal act that preempts state anti-spam laws. In response to this federal statute, California, and many other states have passed similar anti-spam laws. Do you have a new company that needs to market to a broader community? Will your company create an email list to reach out to new users, customers, or clients? Then you should be aware of the federal and state laws and how they can create liability.
What is the CAN-SPAM Act?
The CAN-SPAM Act mostly focuses on unsolicited commercial email. It stands for Controlling the Assault of Non-Solicited Pornography and Marketing. This federal law prohibits any commercial email that is fraudulent or deceptive and requires all email messages to include an opt-out option for the recipients. Although, the law is focused on companies that disguise the source or purpose of the email, the impetus for passing the bill was the growing cost problem for those receiving mass amounts of emails such as non-profit companies, educational facilities, and other businesses with limited server space. However, this law “only provides a private cause of action to internet service providers that have been adversely affected by prohibited commercial e-mails, and does not extend a cause of action to the recipients of such e-mails.” See Hypertouch, Inc. v. ValueClick, Inc., 192 Cal. App. 4th 805, 123 Cal. Rptr. 3d 8 (2011). Therefore, it is up to the states to determine whether individual recipients of spam can bring suit against companies or individuals.
What are California’s Anti-spam laws and what effect do they have on companies?
The California Anti-SPAM laws are contained in the Business and Professions Code sections 17529-17529.9. This code is also focused on prohibiting fraudulent and misleading emails and faxes that can cost companies and individuals unnecessary time and money. According to Business & Professions Code § 17529.2, a person or entity may not initiate or advertise, or assist in initiating and advertising, in an unsolicited commercial e-mail advertisement from California, send one from a California email address, or send one to a California email address. In fact, Business and Professions Code section 17529.5, permits both recipients of spam and the Attorney General to bring suit against companies and individuals sending spam within the prohibited definitions. It only takes one email delivered to one person to create liability. Those bringing suit can claim actual damages, liquidated damages of $1,000 to $1,000,000 per prohibited email, and attorney’s fees and costs. The damages a company may have to pay are drastically reduced if it can be shown that it used due diligence to prevent its emails from falling under the prohibited emails defined in the code. In general, email service providers are not liable if they are only involved in the transmission of the email and may bring a separate claim against violators of their anti-spam policies. You may click here for more information on state anti-spam statutory guidelines.
At our law firm, we are knowledgeable regarding anti-spam laws. We guide our clients on how to avoid falling afoul of anti-spam laws. You may contact us to setup a free consultation.