Internet Library of Law
and Court Decisions

CAN-SPAM Act - Internet Library of Law and Court Decisions - Updated November 22, 2008

This section of the Internet Law Library contains a host of court decisions addressing the Federal CAN-SPAM Act, 15 U.S.C. Section 7701, et seq., the ability of Internet Service Providers and others to use it to prevent the transmission of unwanted spam and unsolicited commercial email, the type of communications it covers and the obligations CAN-SPAM imposes on those who transmit unsolicited commercial email.

Court denied motion to dismiss complaint charging the defendant Union and two of its organizers with violating the CAN-SPAM Act by sending email solicitations promoting union membership to Verizon employees which purported to come from Verizon managers who did not authorize their transmission.  The Virginia District Court held that it could exercise personal jurisdiction over the non-resident Union organizers because both the corporate servers used to transmit these emails, as well as some of the employees who received them, were located in Virginia. 

The Court further held that plaintiff Verizon had stated valid CAN-SPAM claims against the defendants.  In reaching this result, the Court rejected defendants’ contentions that their solicitations constituted non-commercial speech promoting union membership exempt from the strictures of CAN-SPAM.  Because the Union rendered a service – representation of employees – for a fee – union dues – the emails constituted commercial speech.  As such, held the Court, the failure of these emails to accurately describe their source, or to appropriately advise that they were, in fact, advertisements, as well as their failure to provide mandated opt-out instructions, rendered their senders potentially liable for violations of CAN-SPAM.

The Court holds that the inclusion of allegedly false information in the body of an e-mail does not constitute a violation of either Sections 7704(a)(i) or (b)(A)(ii) of the CAN-SPAM Act, 15 U.S.C. §7701 et seq. and accordingly dismisses a complaint asserting claims alleging their violation.

Court holds defendant's unauthorized transmission of commercial e-mails automatically converted by recipient's cell phone carrier into text messages runs afoul of the Federal Telephone Consumer Protection Act, 47 U.S.C. §227 ("TCPA").  Such conduct constitutes a prohibited use of an "automatic dialing system" to make a "call" to a "telephone number assigned to a cellular telephone service." 47 U.S.C. §227 (b)(1)(A)(iii).  The Court further held that the TCPA was neither preempted by the CAN-SPAM Act's regulation of such conduct, nor an unconstitutional regulation of speech that violated the First Amendment.

Finding plaintiff MySpace likely to prevail on its claims that defendant Sanford Wallace violated the CAN-SPAM Act, 15 U.S.C. Section 7704, as a result of his transmission of unsolicited commercial emails to MySpace users, the Court issued a preliminary injunction, enjoining defendant, inter alia, from further use of MySpace or its internet messaging service, from establishing or maintaining MySpace accounts, or from using MySpace for commercial purposes.

Defendant sent email messages to MySpace users that redirected them to a website containing a MySpace logo at which defendant solicited their user name and passwords.  Defendant used this information to hijack and log onto those users’ profiles, from which he then sent messages to the users’ MySpace ‘friends’ inviting them to visit defendant’s websites.  These email messages did not comply with CAN-SPAM.  Among other things, they did not contain a valid physical address for defendant, did not provide opt out instructions, or provide a valid return email address at which defendant could be contacted to request that no further emails be sent.  Moreover, they did not, in their header information, identify defendant as their source.  As such, held the Court, plaintiff was likely to establish a number of violations of CAN-SPAM, and was accordingly entitled to injunctive relief. 

In reaching this result, the Court found that CAN-SPAM applied to emails sent from one MySpace user to another, over the MySpace network.  The Court also noted that CAN-SPAM applied to instant messages.

Court holds that defendant’s creation and use of 95 MySpace accounts to transmit unsolicited commercial email promoting its communications products runs afoul of both the CAN-SPAM Act, and California Business and Professions Code Section 17529.5, and violates MySpace’s Terms of Service.  Defendant created these accounts without identifying itself as the account holder.  The emails violated CAN-SPAM because they failed to contain either a valid physical address for defendant the Globe.com, or instructions on how to avoid receiving further email solicitations.  In addition, they were impermissibly sent to MySpace user email addresses generated by use of a script software program, another violation of CAN-SPAM.  They were also sent from email accounts obtained through false or fraudulent pretenses, as a result of defendant’s failure to accurately identify itself as the account holder.   

The Court found that these emails also violated California B & P Code Section 17529.5, both because they contained false header information that failed to identify the Globe.com as their source, and because they contained misleading subject lines that failed to accurately describe the emails’ contents.

Finally, the Court found defendant’s conduct violated MySpace’s Terms of Service, which prohibited the use of MySpace accounts both for commercial purposes and to transmit spam, and prohibited the use of scripts to generate email addresses for the transmission of commercial email to MySpace account holders.  As such, the Court held defendant liable for liquidated damages of $50 for each email sent as mandated by the Terms of Service.  In reaching this result, the Court rejected defendant’s challenge to such clause on the ground that it was an unenforceable penalty provision.

The Fourth Circuit affirms the dismissal of claims brought by defendants under CAN-SPAM and Oklahoma statutory and common law arising out of defendants’ receipt of 11 unsolicited commercial emails from plaintiff Cruise.com.  Defendants’ claims were premised both on their assertion that the email at issue contained inaccurate contact information, and that plaintiffs continued to send them commercial email after receipt of a complaint from defendants concerning the emails.

The Court dismissed the claims defendants advanced under an Oklahoma state statute that sought to regulate the transmission of commercial email that contained any false information as to its source, holding that state statute preempted by the Federal CAN-SPAM Act.  The Court dismissed the trespass to chattels claim asserted by defendants on the grounds that defendants did not establish that they sustained more than nominal damages as a result of their receipt of the commercial emails in question.  The Fourth Circuit held this failing fatal to defendants’ trespass to chattel claim.  Finally, the Fourth Circuit dismissed defendants’ CAN-SPAM Act claim, holding the immaterial errors in the header/source information of commercial emails was not actionable under CAN-SPAM.  Defendants could readily identify and contact the sender of the emails in question from the information contained therein.  Defendants’ claims that plaintiffs violated CAN-SPAM’s provisions concerning the removal of a recipient from future emails upon request failed because defendants did not show plaintiffs engaged in “a pattern or practice” of failing to honor such requests, a prerequisite to such a claim under CAN-SPAM.

Quick Hits

Denying in large part defendants’ motion to dismiss, the Court held that plaintiff, an internet service provider, stated claims under both CAN-SPAM and California Business and Professions Code Section 17529 et seq., as a result of the transmission of allegedly deceptive and unsolicited commercial email to plaintiff’s servers.  These emails were allegedly sent to generate leads for defendants mortgage brokers’ businesses.  The complaint alleged that the emails in question were sent by ‘spammer defendants’ at the request of ‘lead generators’ who, in turn, had contracts with the defendant mortgage brokers to provide leads of prospective customers.  The Complaint alleged that the mortgage brokers “knew or consciously avoid knowing” that the lead generators and spammer defendants were violating CAN-SPAM, and of the injury being cause plaintiff thereby.  The Complaint further alleged that the emails at issue violated CAN-SPAM both because they contained false and misleading headers, indicating that they were purportedly sent from domains that were registered to unknown or false entities, and because they contained misleading subject lines that did not accurately describe the content of the emails, and instead implied that the user’s loan was approved or pre-approved.

A party can be guilty of violating CAN-SPAM even if it did not transmit the email at issue.  As explained by the Court, “to state a claim against the Mortgage Defendants under the CAN-SPAM Act, plaintiff must ‘prove that they paid or induced the Spammer defendants to initiate commercial email messages and that the Mortgage Defendants acted either with actual knowledge, or by consciously avoiding knowing, that the Spammer Defendants’ acts were illegal.”  Because the plaintiff’s complaint did just that, the Court denied, in large part, defendants’ motion to dismiss.

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Court holds that the ‘Good Samaritan’ provisions of the Communications Decency Act (“CDA”), 47 U.S.C. Section 230(c)(2), immunize Internet Service Providers such as defendant Comcast from ‘good faith’ actions taken to block email marketers from sending email solicitations to users of the ISP’s services.  Plaintiff e360Insight brought this action in response to actions taken by Comcast to block it from sending email solicitations to Comcast customers.  Under the CDA, Comcast is entitled to immunity for “any action voluntarily taken in good faith to restrict access to or availability of material that the provider or user considers to be … objectionable, whether or not such material is constitutionally protected …”.  230(c)(2)(A).  Thus, to be entitled to immunity, the ISP must show both that the materials it blocked are 'objectionable' and that it acted in good faith in blocking them.  The Court applied a subjective standard in determining whether the emails in question were objectionable and hence subject to blocking under the statute – i.e. the materials are objectionable if Comcast believes them to be objectionable.  Importantly, it did not matter if the emails complied with CAN-SPAM.  Said the Court:

compliance with CAN-SPAM, Congress decreed, does not evict the right of the provider to make its own good faith judgment to block mailings. …  Under the law, a mistaken choice to block, if made in good faith, cannot be the basis for liability under federal or state law.  To force a provider like Comcast to litigate the question of whether what it blocked was or was not spam would render Section 230(c)(2) nearly meaningless. 

Because Comcast believed the emails at issue were objectionable, and because plaintiff failed to adequately plead that Comcast did not act in good faith when it made its decision to block plaintiff’s emails, Comcast was entitled to immunity, and the Court dismissed the claims plaintiff asserted against it for violation of the Computer Fraud and Abuse Act and of plaintiff’s rights under the First Amendment, as well as for tortuous interference with prospective economic advantage and violation of the Illinois Consumer Fraud Act.

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Affirming the Court below, the Fifth Circuit holds that the University of Texas at Austin (“UT”) can block unsolicited commercial email sent by plaintiff White Buffalo Ventures (“White Buffalo”) to UT students that promote plaintiff’s online dating services.  Importantly, UT can take such action notwithstanding the fact that White Buffalo’s commercial emails comply with CAN-SPAM.

In reaching this result, the Fifth Circuit rejected White Buffalo’s arguments that UT’s conduct constituted state action preempted by CAN-SPAM.  The Court held that UT was a state actor, and that its determination to block unsolicited commercial email was a state regulation that fell within the ambit of CAN-SPAM’s preemption clause, found in section 7707(b)(1).  This section provides that CAN-SPAM preempts state regulation of email unless such regulation ‘prohibits falsity or deception’ in the email.

However, the statute further provides that ‘nothing in this chapter shall be construed to have any effect on the lawfulness or unlawfulness … of the adoption, implementation or enforcement by a provider of Internet access service of a policy of declining to transmit, route, relay , handle or store certain types of electronic mail messages.’  Section 7707(c).   As the provider of Internet access service – students are enabled by UT to access the internet via its wireless network, and to use email addresses UT provides – this section expressly permitted UT to adopt a policy blocking those who send spam to its network.

The Fifth Circuit held that Section 7707(c) conflicts with Section 7707(b)(1), and thus draws into question the limits of the preemptive effect of CAN-SPAM.   Given these conflicting provisions, held the Court, the presumption against preemption counseled against finding UT’s regulations invalidated by CAN-SPAM.  As such, the Court rejected White Buffalo’s argument that CAN-SPAM mandated that UT’s policies be invalidated on the ground that they ran afoul of CAN-SPAM, or were preempted thereby.

The Court similarly rejected White Buffalo’s claim that UT’s bar on the transmission of its commercial emails ran afoul of the First Amendment.  The Court held that the regulation was reasonably calculated to protect a substantial governmental interest – protecting users of its email network from the hassle associated with unwanted spam – and was no more extensive than necessary to protect that interest. 

The Fifth Circuit did hold that an absolute ban on the transmission of White Buffalo’s emails may be an overly broad restriction – from a First Amendment prospective – if the only interest protected was the capacity of UT’s system to handle the needs of its user community.  Summary judgment was inappropriate, on the record then before the Court, to sustain such a contention.  

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Additional cases can be found in the Spam/Junk Email section of the Internet Library.

The full text of both the CAN-SPAM Act, and the FTC's Rules Implementing the CAN-SPAM Act of 2003, 16 C.F.R. Part 316, can be found in the Statute section of the Internet Library.