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CAN-SPAM: "No Harm, No Foul" -- 4th Circuit Passes on Trivial Violations

By Chip Cooper

Republish: EasyPublish™ Published: 22Jun2008 Word count: 536 Viewed: 500 time(s) Get Free Content For Your Site

The federal CAN-SPAM Act permits the sending of unsolicited email advertisements under certain conditions. One condition is that header information in the email should not be "materially false or materially misleading". What does this mean, and if you make a "technical" mistake in an email header, are you strictly liable under CAN-SPAM?

The Vacation Spammer Case

In November, 2006, the 4th Circuit Court of Appeals commented in the case of Omega World Travel v. Mummagraphics, Inc.(sometimes referred to as the "Vacation Spammer Case") that while Spam (unsolicited commercial email) remains a vexing problem, the federal CAN-SPAM Act "does not impose liability at the drop of a hat". This is a good thing for email marketers.

The defendant, Omega World Travel, sent unsolicited emails to plaintiff Mummagraphics advertising travel cruises. The emails did not properly identify Omega's internet domain and email address, but they did include an opt-out email address. Mummagraphics' President did not use the opt-out feature, but he did complain, even to the extent of posting pictures of Omega's owners on anti-spam websites, which prompted Omega to sue for defamation. Mummagraphics counterclaimed for violations of the CAN-SPAM Act as well as Oklahoma statutes.

The Court's Holdings

On appeal, the 4th Circuit held that (1) the Federal CAN-SPAM Act preempts state law claims premised on immaterial or "bare error," (2) certain technical inaccuracies in the header information did not violate CAN-SPAM's prohibition against "materially false or materially misleading" header information, and (3) one instance of not honoring an opt-out request within the specific time did not constitute a "pattern or practice."

You may ask: why is the preemption of Oklahoma statutes significant? The answer is that Oklahoma statutes imposed less of a burden on Mummagraphics than CAN-SPAM. Mummagraphics argued that all it had to show for a violation of Oklahoma's statutes was mere "falsity" in Omega's email headers, and not that the headers were "materially false or materially misleading" as required by CAN-SPAM. The court reasoned that to allow states to prohibit immaterial error would undercut Congressional intent as manifested in the CAN-SPAM Act, and for this reason, federal preemption was appropriate.

Regarding the CAN-SPAM claims that Omega's email headers were "materially false or materially misleading", the Court found that the header information was not materially false or misleading because the emails provided various methods to identify, locate, or respond to the sender or investigate an alleged violation of the CAN-SPAM Act. Omega's emails provided its mailing address, a local phone number and a toll-free number. Based on the various means of identifying and locating the sender in Omega's emails, the 4th circuit held that the alleged inaccuracies were not material nor misleading.

Conclusion

What do you think; do you like the outcome of this case? Your answer will depend on your point of view - - whether you are a company engaged in email marketing, or an anti-spam activist. Email marketers may draw some comfort from not living under the constant threat of a lawsuit for immaterial errors and trivial violations of CAN-SPAM. On the other hand, anti-spam activists will view this case as a major defeat.

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