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California Gov. Gray Davis just signed into state law arguably the toughest anti-spam law in the United States. But will this new law work in combating spam, and will it pass constitutional muster? Only time will tell. In the surprising absence of a federal law that grapples with spam head-on, approximately 35 states have enacted their own laws to try to deal with the problem. These state laws differ one from the other. Still, there are some commonalities, such as requirements that unsolicited commercial e-mails: (a) plainly reveal their true nature with initials such as ADV in subject lines to identity them as advertisements, (b) contain correct return e-mail addresses and 800 telephone numbers, and (c) that requests to opt out of the receiving of the e-mails be honored rapidly. Notwithstanding these state laws, the spam problem keeps growing more severe. Then along comes California with Senate Bill 186, just signed into law by Davis, that will take effect on Jan. 1, 2004. This law tries to go farther than other state laws. The new California law will do the following: � Prohibit a person or entity located in California from initiating or advertising in unsolicited commercial e-mail advertisements; � Prohibit a person or entity not located in California from initiating or advertising in unsolicited e-mail advertisements sent to a California e-mail address; � Prohibit a person or entity from collecting e-mail addresses or registering multiple e-mail addresses for the purpose of initiating or advertising in an unsolicited commercial e-mail advertisement from California or to a California e-mail address; � Prohibit a person or entity from using a commercial e-mail advertisement containing certain falsified, misrepresented, obscured or misleading information; � Authorize the recipient of spam, the electronic e-mail service provider, and the state attorney general to bring an action to recover actual damages and would authorize these parties to recover liquidated damages of $1,000 per transmitted message up to $1,000,000 per incident; � Authorize the award of reasonable attorney fees to a prevailing plaintiff; and � Make violation of the law a crime. ENFORCEMENT There is no question that this law seeks to stop spam in its tracks, by outright prohibiting unsolicited commercial e-mail, by allowing for large damage claims and attorney fees, and by criminalizing violations. But what about enforcement? This has been a problem, because oftentimes the senders of spam are located offshore and their return e-mail addresses move around and are difficult to track. Now, however, the new California law seems to target not only the senders of spam, but also the advertisers whose products and/or services are touted in the unsolicited e-mails. Advertisers are not happy about this feature, arguing that they do not know whether the senders they have retained are sending e-mail to opt-in recipients (permission-based marketing), or whether they are guilty of practices that will run afoul of the new law. None of the prior state laws has succeeded in stopping spam. Indeed, according to the findings in Senate Bill 186, about 40 percent of e-mail traffic in the United States is comprised of spam, and the cost of dealing with spam will exceed $10 billion in the United States this year, with the cost being $1.2 billion in California alone. So will this law work where other laws have not? It certainly has more teeth, and that may be a deterrent. However, it is just the law of one state, and it may not be readily known and heeded by people and entities outside of California who send e-mail to California. Moreover, oftentimes a sender of e-mail simply sends e-mail to given e-mail addresses, without knowing the physical location of the recipients. CONSTITUTIONALITY Undoubtedly, California’s new law will result in litigation. Not only will recipients of spam, e-mail service providers, and perhaps the state attorney general seek significant damages from spammers, there likely will be litigation as to whether the new law is consititutional. One argument that might be advanced is that the First Amendment to the United States Constitution broadly prohibits restrictions on freedom of expression. However, certain restrictions on free speech have been upheld by the courts. Probably more threatening to the law is the argument that it violates the dormant commerce clause in the Constitution. Specifically, the law of one state is not supposed to result in differing burdens on interstate commerce. Here, any e-mails from outside California that land in California would be subject to the tough provisions of the new law, whereas e-mails sent to other states would not be so governed. As mentioned, the senders of mass e-mails do not know precisely where each of their e-mails is going, and California’s new law certainly can be argued effectively to violate the commerce clause. Law might not be the complete answer, and further technological solutions need to be explored. Still, to really deal with the spam problem as best as possible from a legal standpoint, Congress needs to step up to the plate and enact an anti-spam law that is applicable in all 50 states. Eric Sinrod is a partner in the San Francisco office of Duane Morris ( www.duanemorris.com), where he focuses on litigation matters of various types, including information technology disputes. Mr. Sinrod’s Web site is www.sinrodlaw.com, and he can be reached at [email protected] . To receive a weekly e-mail link to Mr. Sinrod’s columns, please type Subscribe in the subject line of an e-mail to be sent to [email protected] .

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