California’s Anti-SPAM Statute Litigation Landscape

By Richard NewmanOctober 13, 2014

California has the nation’s most aggressive anti-SPAM law, Business & Professions Code § 17529.5 (the “Statute”).  The Statute imposes significant penalties for violations. 

The Statute generally prohibits unsolicited commercial email sent to California email addresses, as well as unsolicited commercial email sent from California.  The Statute also prohibits the sending of any commercial email advertisement from California or to a California electronic mail address that contains falsified, misrepresented or forged header information or which contains a subject line that a person knows would be likely to mislead a recipient about a material fact regarding the contents or subject matter of the message. 

“Header information” is “the source, destination and routing information attached to an electronic mail message, including the originating domain name and originating electronic mail address, and any other information that appears in the line identifying, or purporting to identify, a person initiating the message.”  This definition has been adopted from the CAN-SPAM Act of 2003.

There are trends developing as more and more deceptive advertising-based SPAM litigation “shake-down” matters initiated against advertisers, ad networks, publishers and lead generators are being filed.  Renowned professional SPAM plaintiffs’ attorneys typically allege: (i) that email headers fail to disclose the actual sender; (ii) untraceable proxy domain names; (iii) that email advertisements contain “Subject” lines that are likely to mislead recipients, acting reasonably under the circumstances, about a material fact regarding the contents of subject matter of the message; and (iv) that email advertisements contain or are accompanied by a third-party domain name without the permission of the third- party. 

Some notable lessons learned from past and recent court rulings regarding “From” and “Subject” lines…

1.         “From” Lines

  • A header that identifies the businesses on whose behalf the email was sent falls within the exception to liability under sec. 17529.5(a)(2) even if the actual sender’s domain name is not traceable;
  • It is unlawful to send commercial email that contains both a generic “From” line and is sent from a proxy/privately registered domain name;
  • Untraceable proxy domain names are not per se unlawful;
  • There is no requirements under the Statute that the “From” name identify that actual sender of the email and the company being advertised; and
  • There is no liability under the Statute where an advertiser authorizes a third-party to use its name in commercial email advertisements, and the advertiser is actually identified in the email “From” line or

“Subject” line, or both.

Note: Trend for defendants to assert preemption under the Act based upon an immaterial inaccuracy by arguing that even if a “From” line neither identifies the name of an existing company or person on its face nor is readily traceable to the sender using a publicly available online database, there is nothing deceptive about the header itself so long as a recipient can identify the entity whose products and services are being advertised by opening the email itself.  The issue is currently being considered by the Court of Appeal for the State of California.

2.         “Subject” Lines

  • Nothing in the text of § 17529.5(a)(3) requires that the “Subject” line of a commercial solicitation affirmatively indicate that it is that type of communication;
  • “Subject” lines in unsolicited commercial messages containing phrases such as ‘how are u’ and ‘whassup,’ leading recipients to believe that  emails are personal messages, are a violation of § 17529.5(a)(3);
  • It is a violation of § 17529.5(a)(3) where the “Subject” line of the email creates the impression that the content of the email will allow the recipient to obtain a free gift by doing one act (such as opening the email or participating in a single survey), and the content of the email reveals that the ‘gift’ can only be obtained by undertaking more onerous tasks (such as paying money for the gift or agreeing to partake in other offers);
  • “Subject” lines should be consistent with statements contained in the body of the email;
  • Do not omit material facts from the “Subject” line or you may be liable under the Statute, even if the “Subject” line is not misleading when solely compared to the email contents; and
  • A violation of the Statute does not turn on whether a “Subject” line is true or false, taken in the context of the email as a whole or in light of a hyperlinked page.  Rather, the question is whether the “Subject” line might in fact lead a reasonable person to expect something materially different than the message’s actual content or subject matter.

Given that plaintiffs’ attorneys continue to attempt to circumvent recent court rulings with coercive litigation tactics and varying legal interpretation of case precedent, the potential impact of the Statute upon advertisers, networks and publishers sending unsolicited commercial email should not be overlooked.  In addition to actual damages, the Statute imposes statutory damages of up to $1,000 for each unsolicited commercial email advertisement received by a recipient, up to $1,000,000 per incident. 

SPAM emails are typically sent in “blasts.”  Thus, the potential for hundreds of thousands of dollars in liquidated damages is real and substantial.  Courts, however, must reduce the liquidated damages that a plaintiff can recover to a maximum of $100 for each email or $100,000 per incident if a defendant is able to establish the implementation of practices and procedures to effectively prevent illegal unsolicited commercial email advertisements.

Consult with a SPAM law compliance and litigation defense attorney that possesses familiarity with renowned professional SPAM plaintiffs’ lawyers, email marketing compliance and data management protocols, contract and related indemnification issues, as well as the commercial email litigation and regulatory landscape.

Disclaimer: This article is intended for informational purposes only and does not constitute legal advice on any specific facts or circumstances. This article is not intended to create, and receipt of it does not constitute, an attorney-client relationship.

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