By: Linda Goodman
In a case that has wide implications for how anti-spam laws are interpreted and used in court, e-mail marketers recently won a decisive victory when a judge ordered a trial on the issue of whether an anti-spam plaintiff was a bona fide service provider under the California and Maryland statutes. The result was that the jury held you cannot use spam-traps for litigation!
Paul Wagner, who ran a computer business from his parent’s home, sought more than $12 million from Kraft Foods under Maryland’s anti-spam law. Wagner had sued for thousands of e-mails forwarded by his brother in California, to an e-mail address intentionally designed to lure spam. In other words, he used a ‘spam-trap’. The captured ‘spam’ was then used as the basis for the lawsuit.
In the case against Beyond Systems, Inc., an alleged Internet service provider owned by Paul Wagner (brother of anti-spam plaintiff, Hypertouch, Inc., owned by Joe Wagner), the judge asked lawyers for both sides to make additional arguments about whether the law requires a company to be a bona fide service provider in order to sue for damages.
The jury was clear. Spam traps for the purpose of bring lawsuit is wrong!
The jury found that Beyond Systems was not a bona fide “electronic mail service provider” under California’s anti-spam or an “interactive computer service provider” under Maryland’s anti-spam statute. Instead, Beyond Systems functioned to “primarily or substantially” file anti-spam lawsuits. To be a Bona fide e-mail service provider Wagner would “have to be substantially involved in the business of providing Internet services” which he was not. In other words, Wagner must be genuine and provide services and he is not.
Promoting products and services through e-mail marketing is one of the most powerful, flexible and cost-efficient means of direct marketing. While e-mail marketing strategies are used by businesses of almost every kind to get their message across to a targeted audience, many argue that people are less receptive to e-mail because they are constantly overloaded with “spam.” This is not true, a good e-mail marketer is one who knows the legal requirements, meets them and at the same time adjusts the manner and method of sending to get through the spam blocks resulting in-boxed promotions.
Promoting products and services through e-mail marketing is big business and so are anti-spam lawsuits. With more than half the states and the federal government having laws that restrict commercial e-mail marketing, it is imperative that you understand and comply with the most restrictive laws.
The consequence of failing to be informed and in compliance will result in fiscal chaos. Maryland’s law, passed in 2002, allows private individuals to sue for $500 for each e-mail and $1,000 for Internet service providers. The CAN-SPAM Act, a law that establishes specific requirements for commercial messages spells out tough penalties for violations. It covers all commercial e-mails and makes no exception for business-to-business email. Violation of the CAN-SPAM Act can subject you to penalties of up to $16,000.
Compliance Recommendations: All commercial emails must be truthful and accurate and have the follow components:
- From Line: Must identify the “Sender” which is the entity whose products and services are identified in the body of the email; It must also include an accurately and openly registered mailing domain;
- To Line: Must be left blank, “undisclosed” or the consumers email address;
- Subject Line: Must accurately describe the product or service in the body of the email;
- Body of the Email: Must accurately and truthfully describe the product or service being advertised;
- Physical Address: The Sender must provide a physical address readily identifiable to the Sender;
- Unsubscribe Mechanism: There must be an unsubscribe mechanism which suppresses consumer email addresses within 10 days.
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This article is a publication of The Goodman Law Firm and is intended to provide information on recent legal developments. This article does not create an attorney-client relationship, nor should it be construed as legal advice or an opinion on specific situations. This may constitute “Attorney Advertising” under the Rules of Professional Conduct and under the law of other jurisdictions.
Linda L. Goodman is the founder of The Goodman Law Firm, concentrating its practice in internet business and law. Her firm’s clients include Advertisers, Affiliates, Affiliate Networks, and ISP’s.
© 2013 TGLF, A.P.C.