Senate approves antispam bill

President George W. Bush has indicated that he will sign the bill, called the Controlling the Assault of Non-Solicited Pornography and Marketing Act (Can-Spam), after he receives it in December.

During a brief floor discussion before the voice vote, Democrats and Republicans alike hailed Can-Spam as a long-sought compromise that would curb Viagra advertisements and get-rich-quick propositions from clogging Americans' e-mail in-boxes. Sen. Ron Wyden, D-Ore., said that "when this bill takes effect, the big-time spammers who up until now have faced virtually no penalties will suddenly be at risk of criminal prosecution, (Federal Trade Commission) prosecution and million-dollar lawsuits."

Sen. Conrad Burns, R-Mont., said: "In cases where e-mail marketers don't comply with the Can-Spam bill, the penalties are very severe...Spammers are actually on the hook for (per e-mail) damages, with a cap of $2 million."

Tuesday's vote formalizes the third version of Can-Spam, which has been bouncing back and forth this fall between the two corners of Capitol Hill. The Senate voted for the first version in October, and the House of Representatives approved a second one early Saturday morning. The third measure cannot go to Bush for his signature until it is approved again by the House, which a congressional aide predicted would happen the week of Dec. 8.

All three versions of Can-Spam are similar, and all represent a compromise not as far-reaching as some antispam advocates had urged. They punish sending fraudulent commercial e-mail with criminal penalties but take an "opt out" approach that does not ban bulk, unsolicited e-mail advertisements. They permit but do not require the FTC to create a "do not spam" registry.

America Online and technology trade associations have applauded Can-Spam, which, if enacted, would become the first federal law to regulate spam. "This is a critical new law that will help us turn the tide against spam in the online medium for good," AOL said in a statement Friday. The NetChoice coalition, which includes eBay, Orbitz and the Information Technology Association of America, called the congressional votes "very encouraging."

The latest version of Can-Spam, approved by the Senate, includes at least four changes:

• Under the House bill, once commercial e-mail senders obtained "affirmative consent" from recipients, they would not have to follow certain rules such as providing an easy way to unsubscribe from future mailings. The Senate proposal eliminates that language.

• State attorneys general would, according to the House bill, have a tougher time seeking injunctions against spammers engaged in header forgery or who bounced mail through networks "accessed without authorization." The Senate bill makes it easier to stop them. The Senate bill also would make it easier for the Federal Trade Commission and the Federal Communications Commission to obtain cease-and-desist orders against header-forging or network-intruding spammers.

• The House proposal gives federal judges more discretion in granting "reasonable attorney fees" to state attorneys general. The Senate version does not.

• The Senate version broadens the definition of what qualifies as spam sent to mobile devices.

All versions of Can-Spam would pre-empt more restrictive state laws, including an unusually regulatory statute California enacted in September that caused even legitimate online marketers to worry about frivolous lawsuits. With final passage of this bill, the core of California's opt-in law would never take effect.

The Direct Marketing Association, which once opposed antispam laws and reversed its position a year ago, called Can-Spam a "positive development." DMA public affairs director Louis Mastria said it is "imperative that we have a national standard for e-mail marketing, because it's at the very least a national marketplace. To have anything that's less than a federal standard would be No. 1 ineffective and No. 2 put a (damper) on the larger marketplace."

In addition, according to Spam Laws, compiled by law professor David Sorkin, at least 15 states currently require "ADV:" or a similar label on unsolicited commercial e-mail. If Can-Spam is enacted, those laws would become void, and spammers in those states would no longer be required to follow the labeling requirements. The list includes Arizona, California, Colorado, Illinois, Michigan, Nevada, Texas and Utah.

Criticism of Can-Spam has not been limited to antispam advocacy groups. A letter The National Association of Attorneys General sent to Congress earlier this month bluntly warns: "The bill creates so many loopholes, exceptions, and high standards of proof, that it provides minimal consumer protections and creates too many burdens for effective enforcement...We respectfully request that you not move forward..."

A House divided
One reason it took so long for Congress to act is that the House has been deadlocked between competing bills--one backed largely by Democrats and one supported almost entirely by Republicans. In contrast to an early Republican proposal, the Can-Spam bill does not expressly prohibit class-action lawsuits, a favorite of trial lawyers whose deep pockets make them hugely valued contributors to the Democratic Party. Unlike other bills, Can-Spam would permit Internet service providers, but not individuals, to file lawsuits against spammers.

Even as the Senate prepared to vote on CAN-SPAM, criticism grew from the antispam community, which points out that no federal law can be effective against overseas spammers. "From a consumer perspective, there's not a lot of good news there except the 'do not e-mail' list," said Ray Everett-Church, a lawyer at ePrivacy Group who follows spam laws. "You're talking about pre-empting laws that the Federal Trade Commission and attorneys general haven't been able to enforce. With the new law, they can be busy not enforcing a federal law."

Loren McDonald, a vice president at e-mail delivery firm EmailLabs, which sends mail on behalf of Nokia, NEC, Bell Canada and Texas Instruments, said of Can-Spam: "In many respects, it's pretty disappointing. It really just makes unsolicited commercial e-mail legal. It causes further problems for us, because it could increase the volume of what we consider to be (spam) e-mails. Those compete with our legitimate clients' e-mails."

Can-Spam's criminal penalties include outlawing e-mail header falsification, sending commercial e-mail with deceptive subject lines, and sending commercial e-mail that does not include "a functioning return" address or a link to a Web form capable of accepting unsubscribe requests. It also regulates sexually oriented e-mail and e-mail address harvesting.