Practical Guide to the Federal CAN-SPAM Act
By: STEVEN E. HELLAND & JOHN C. PICKERILL
December 2003
The first federal law specifically regulating commercial email, the CAN-SPAM Act, will take effect January 1, 2004. The Act will, in most cases, supersede the array of anti-spam legislation passed by more than 30 different states, including California’s strict anti-spam law which was also set to take effect on January 1.
Applicability
Similar to Minnesota’s spam law, the federal Act does not prohibit unsolicited email advertising. Instead, it prohibits certain fraudulent or deceptive practices and requires an opt-out mechanism.
The Act covers more than just unsolicited email, or spam. It applies to any “electronic mail message the primary purpose of which is the commercial advertisement or promotion of a commercial product or service.” If an email is covered, the Act:
- Prohibits false or misleading “header” (the “From” line) information.
- Prohibits deceptive “Subject” lines.
- Requires that the email include a mechanism, either by email or a webpage form, to request not to receive future email from the “sender.” (“Senders” include both Transmitters and Sellers. See below.) If a business uses an email marketing firm to advertise its goods or services, the two should cooperate to share a do-not-email list of individuals who request not to receive additional email.
- Prohibits sending additional email to an individual who has requested not to receive additional email. Such requests must be processed and honored within ten days.
- Requires that the email include a “clear and conspicuous identification that the message is an advertisement or solicitation.”
- Requires that the email include a valid physical postal address of the “sender.”
Some exceptions to the above requirements apply if an email message is a “transactional or relationship message,” such as a confirmation of a previous transaction or a periodic account statement. Additional rules apply to email containing adult content.
Who is A “Sender?”
The requirements listed above apply to “senders” of email. The definition of “sender” includes both: (1) the entity that initiates or transmits the email message (the “Transmitter”); and (2) the entity whose product, service, or website is promoted by the message (the “Seller”). Therefore, if a Seller uses an outside emailing firm or other Transmitter to send advertisements over email, the Seller should monitor the Transmitter to ensure it complies with the Act. The Seller should also include in a written contract representations and warranties that the Transmitter will comply with the Act, establish a do-not-email list, and will indemnify the Seller for any violation.
Limited Enforcement Against Sellers
Although, as noted above, the Act applies to both email Transmitters and Sellers, the Act states that it will only hold Sellers liable if either: (1) the Seller has “actual knowledge” that the Transmitter is violating the Act; or (2) the Seller owns more than a 50% interest in the Transmitter.
Enforcement
The Act is enforced by the Federal Trade Commission (“FTC”) and by State Attorneys General. Unlike some state laws, now presumably pre-empted by the federal Act, individuals do not have a right to sue for damages. Application services providers have a limited right to sue for damages under the Act. The government may seek injunctions, prison terms, or fines of up to $250 per email for violations of the Act. Triple damages are available for willful violations or violations in which email addresses were “harvested” off other websites or generated by “dictionary” attack programs.
The Future
The FTC is charged with issuing additional guidance related to the Act, such as specifying the warning necessary for adult-content email. The FTC must also issue a report on the possibility of creating a national Do-Not-Email registry similar to the existing Do-Not-Call registry. In addition, it is possible that states such as California will sue or draft alternative legislation to attempt to establish more strict limits on spam on an individual state basis.
Sample Compliant Email
From: marketing@mncompany.com |
To: USA-Resident@visi.com |
Subject: Goods or Services for Sale! |
Message: Buy quality goods and services from MN Company! Etc., etc. [Comment: The body of the advertising message must not be false or misleading.] THIS E-MAIL IS AN ADVERTISEMENT OR SOLICITATION FOR GOODS OR SERVICES. [Comment: The Act requires that the email identify itself as an advertisement. The Act does not require any specific words, nor does it require that the notice be included in any particular place in the email, so long as it is “clear and conspicuous.” In addition, this notice is not required if the recipient has given affirmative consent to receive the email.] If you do not want to receive future email from us, [Option 1: send a reply email to remove@mncompany.com][Option 2: complete the “removal” form on the web page located at www.mncompany.com/remove] [Comment: The email must include a method, either through email or an Internet-based form, by which a person can request not to receive future email. This request should be honored both by the email Transmitter and the Seller.] MNCompany's address is This email was transmitted by: [Comment: The email must include a “valid physical postal address of the sender.” Again, “sender” includes both the Transmitter and the Seller.] |
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