Thank you for sharing!

Your article was successfully shared with the contacts you provided.
Almost no one, it seems, has anything nice to say about spam, the ubiquitous junk mail of cyberspace. Recipients find it aggravating, Internet service providers say it’s burdensome, and mainstream marketers moan that it is ruining e-mail as a legitimate advertising tool. Well aware of the complaints, members of Congress have been grappling with legislation to crack down on spam. But despite its unpopularity, spam is proving slippery to regulate. Bills are pending in both the U.S. House and Senate designed to provide relief to millions of Internet users who find their mailboxes stuffed each day with messages like “Sales-Leads Galore!!! $$$!” or “Intensify Pleasure and Orgasms in SEX” or “FANTASTIC HOMEBASED BUSINESS OPPORTUNITY!!” But while most of the players agree that unsolicited commercial e-mail ought to contain a valid return address and honest subject line, some basic issues remain unsettled. Foremost among them: Should consumers have to actively agree to receive unsolicited e-mail, and should there be a private right to sue spammers who send unwanted messages? “We are not interested in interfering with legitimate e-commerce,” stressed Sen. Ron Wyden, D-Ore., at a hearing of the Commerce Communications Subcommittee on April 26. “My biggest concern is we need to act, because people are tired of this.” According to a recent study by the European Union, the total cost of spam worldwide is $9.4 billion. In the United States, industry expert Jason Catlett testified at the Senate hearing that spam costs the average Internet user $1 a month, because the sheer volume of messages requires increased network capacity. America Online, for example, reports that spam accounts for 30 percent of all its e-mail traffic. “The failure to control spam is the greatest economic tragedy of the Internet age,” said Catlett, president of the Junkbusters Corp., which helps consumers avoid unwanted solicitations. “As e-mail marketing becomes synonymous with spam — a tragedy because this is unnecessary and avoidable — many consumers are simply deciding not to participate.” Nonetheless, it’s getting more popular. John Williams, vice president of marketing for Brightmail Inc., which provides spam filters to Internet service providers, or ISPs, reports the number of “spam attacks,” or unique spam messages, rose 400 percent in April 2001 from a year ago. The reason is simple: It’s dirt-cheap to spam millions of people at a time. “For marketers, virtually all it costs is the time it takes to write the message and a small amount of connection time,” Williams notes. Last month, he says, an average of 10,000 different solicitations went out each day to millions of e-mail accounts. Furthermore, according to the Federal Trade Commission, the “vast majority” of spam is fraudulent, containing exaggerated earnings or performance claims about goods and services. Two major spam bills are making their way through Congress. One, sponsored by Rep. Heather Wilson, R-N.M., was passed unanimously by the House Commerce Committee on March 21 and is now before the Judiciary Committee. Last July, a similar measure by Wilson passed in the House by a vote of 427-1, but stalled in the Senate. The other, from Sen. Conrad Burns, R-Mont., and co-sponsored by Wyden, is before the Senate Commerce Committee. Both senators vow to see the bill become law and are working with Rep. Bob Goodlatte, R-Va., in the House. Each bill makes it illegal to send spam with false identifying information, and requires a viable return address so recipients can write back and request to be removed from the sender’s mailing list. But consumer groups like Coalition Against Unsolicited Commercial Email, or CAUCE, a 23,000-member, all-volunteer organization, say that adopting an opt-out standard for receiving spam amounts to postage-due marketing. “When electronic mail is sent unsolicited, it results in costs being shifted to recipients, who, by definition, did not request to bear those costs,” said the CAUCE board of directors in an April 26 statement. “And when that message is sent in the quantities routinely transmitted by unsolicited advertisers, e-mail servers are regularly slowed to a crawl or crash under the weight of mail.” The makers of wireless technology, where users must spend precious minutes of airtime to read e-mail, also strongly back an opt-in standard, where consumers receive only the solicitations they have requested. Neither bill, however, addresses wireless transmissions. CAUCE cites the 1991 ban on all unsolicited fax advertisements as a favorable precedent, since that law has almost totally wiped out junk faxes. But at the same time, the newly formed National Facsimile Broadcast Coalition has hired Paul, Hastings, Janofsky & Walker to lobby to overturn the fax law. “It makes sense now to look at faxes,” says Washington, D.C.-based associate Behnam Dayanim, noting that the convergence of messaging media is blurring the lines between fax and e-mail transmissions. “We should be legislating in a technology-neutral manner,” he says. Still, others following the issue say it is unlikely that sponsors will risk sidetracking the bills by opening up the fax issue. THE SPREAD OF SPAM LITIGATION Perhaps the biggest debate over spam concerns the private right to sue. Under the Burns bill, S. 630, or the Can Spam Act, only ISPs and state attorneys general may file suit against spammers, while the FTC would enforce the law by levying fines. Damages are set at $10 per violation, up to $500,000, with treble damages and attorneys’ fees possible. The Wilson bill, H.R. 718, allows individual e-mail recipients to sue spammers who ignore requests to remove them from mailing lists. Cases could be filed in federal or state court, with damages of $500 per violation, up to $50,000, plus attorneys’ fees and the possibility of treble damages against those who willfully violate the law. Among those who oppose individual suits, the main fear is a flood of litigation. “If you think there aren’t people licking their chops to file class action lawsuits, take a look at the tobacco industry,” says David McClure, president of the U.S. Internet Industry Association, a trade association for ISPs, backbone companies, e-commerce sites, and more. “And it won’t be done solely to commercial e-mailers, but also to ISPs.” David Moore, CEO of online marketer 24/7 Media, whose clients include Reuters, American Express and Law.com, agrees. “A private right of action would be very onerous. There are always going to be some mistakes made. The technology is not perfect.” Even though his company’s rate of error is low — just one complaint per 16,000 e-mails, he says — the risk of being hit with lawsuits would remain. But plaintiffs’ lawyer Harris Pogust of Pennsauken, N.J.’s Sherman, Silverstein, Kohl, Rose & Podolsky argues that consumers and businesses should have the right to recover money they lose as a result of spam. “One might surmise that the ISPs are the ones most damaged by junk e-mails. They suffer the increased expense in trying to filter out these unwanted e-mails, and are required to spend money to provide additional bandwidth,” he testified at the Senate hearing. “But these ISPs already have a way to recoup these additional expenses: charge their end users.” The ones left holding the bag, he continued, are the individual e-mail users, who would be left without recourse. Without expressing an official position on the issue, Eileen Harrington, associate director of marketing practices in the FTC’s Consumer Protection Bureau, argued both sides at the Senate hearing. “ISPs and customers have a unified interest in keeping unwanted mail out of consumers’ mailboxes,” she said. “And ISPs have the resources to take spammers to court, which means there would be one lawsuit, not 10,000.” But she also noted that the Telephone Consumer Protection Act, which gives individuals the right to sue harassing telemarketers in state small claims court, has not triggered a glut of litigation. The FTC is already the top spam cop at the federal level, and Harrington testified that the Can Spam legislation would give the agency enhanced tools to crack down on spammers. It would also provide for dual enforcement by the FTC and state attorneys general, a scheme which she said “has proved extremely successful in the past, particularly in challenging deceptive and abusive telemarketing practices.” But some marketers would prefer to keep the more political state attorneys general out of the picture altogether. “This is first impression law at the federal level, and enforcement decisions will help to shape the law itself,” says Jeremiah Buckley, general counsel for the Electronic Financial Services Council and a D.C.-based partner at Boston’s Goodwin Procter. “We would prefer to see the responsibility for enforcement and shaping the law in the hands of people who have to be responsive to Congress, namely the FTC, rather than the state attorneys general.” With products well-suited to the ethereal nature of cyberspace, the financial services sector has a keen interest in e-commerce, particularly in the wake of last year’s Electronic Signatures in Global and National Commerce Act, which gave electronic signatures the same legal weight as written ones. According to Buckley, many industry members have been using e-mail to send information to existing customers as part of an electronic business relationship. But he reports cases where ISPs with spam-filtering software see the volume of correspondence, conclude it must be spam, and never deliver the messages. As part of the bill, he urges Congress to include a provision requiring ISPs to inform consumers they are blocking e-mail from particular senders. “Spam legislation is fine. It’s trying to recognize people shouldn’t get communication they don’t want to receive,” says Buckley. “But by the same token, you don’t want to see blocked communications which people do want to receive.” As proof, Williams of Brightmail notes that when his company sets up “spam traps,” five percent to 10 percent of end users complain that they miss getting the messages, no matter how fraudulent or obscene. “We need to give people a choice,” he says. “Some people like this stuff.”

This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.

To view this content, please continue to their sites.

Not a Lexis Advance® Subscriber?
Subscribe Now

Not a Bloomberg Law Subscriber?
Subscribe Now

Why am I seeing this?

LexisNexis® and Bloomberg Law are third party online distributors of the broad collection of current and archived versions of ALM's legal news publications. LexisNexis® and Bloomberg Law customers are able to access and use ALM's content, including content from the National Law Journal, The American Lawyer, Legaltech News, The New York Law Journal, and Corporate Counsel, as well as other sources of legal information.

For questions call 1-877-256-2472 or contact us at [email protected]


ALM Legal Publication Newsletters

Sign Up Today and Never Miss Another Story.

As part of your digital membership, you can sign up for an unlimited number of a wide range of complimentary newsletters. Visit your My Account page to make your selections. Get the timely legal news and critical analysis you cannot afford to miss. Tailored just for you. In your inbox. Every day.

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.