Privacy Lawyer & Attorney : Proskauer Rose Law Firm : CAN-SPAM, FCRA, FACTA

On May 12, 2008 the Federal Trade Commission issued its long awaited final set of rules under the CAN-SPAM Act of 2003 (the "Act"). The rule:

• Modifies the term "sender" with respect to multi-advertiser e-mails;
• Clarifies the opt-out request process;
• Defines the term "person"; and
• Clarifies the meaning of "valid physical postal address" of the sender.

The accompanying report:

• Explains the FTC's interpretation of the Act's application to affiliate marketing programs and tell-a-friend campaigns.

The rule will take effect on July 7, 2008.

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In a recent decision, the Northern District of California held that e-mail harvesting without permission may give rise to a cause of action under the California Penal Code and based on common law misappropriation. More striking, however, was the court’s ruling that the federal CAN-SPAM Act, 15 U.S.C. § 7701 et seq., preempts two California anti-spam statutes. Facebook, Inc. v. ConnectU LLC, --- F.Supp.2d ---, 2007 WL 1514783 (N.D. Cal. 2007).

In the litigation, Plaintiff Facebook, Inc. contends that Defendant ConnectU, Inc. violated several federal and state statutes and engaged in common law misappropriation when it collected e-mail addresses of Facebook’s registered users and then sent them commercial e-mail, encouraging them to switch to ConnectU. Among its claims, Facebook argues that ConnectU violated California Penal Code § 502(c), California Business and Professions Code §§ 17529.4 and 17538.45, and CAN-SPAM, 15 U.S.C. § 7701 et seq. ConnectU moved to dismiss several of these claims, pursuant to Federal Rule of Civil Procedure 12(b)(6).

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First CAN-SPAM Jury Conviction

On January 12, 2007, Jeffrey Brett Goodin became the first person convicted by a jury of violating the CAN-SPAM Act of 2003. Using several compromised Earthlink accounts, Goodin perpetrated a phishing scheme by sending thousands of e-mails to America Online Users and requesting personal and credit card information. He and others then used that information to make unauthorized charges on his victims’ credit cards. Goodin is scheduled to be sentenced in the Central District on June 11. He faces up to 101 years in prison.

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