What are the rules on spam?

A private organization asked the following questions: What are the rules on sending bulk e-mail? What does Virginia's new anti-spam law provide?

Most anyone familiar with e-mail has a pretty good idea of what spam is. In common parlance, the term is used to describe the unsolicited bulk e-mail that typically offers goods or services for a fee. Spammers often engage in another unsavory activity called "spoofing." In general, spoofing is the use of a fabricated return electronic address to misrepresent the identity of the sender.

At best, spam annoys huge numbers of people while providing virtually no societal value. Indeed, for many people, spam can seem like an invasion of privacy. Legislators have tried many times to pass laws restricting spam, but most of these efforts have seen little success.

Most efforts to regulate spam have been patterned on laws restricting unsolicited commercial voice or fax solicitations over telephone lines. Because such laws limit the constitutional guarantee of free speech, many of them have been stricken or severely limited in application. However, some level of success has been seen with these laws.

As part of the Telephone Consumer Protection Act of 1991 (47 U.S.C. 227), Congress prohibited the use of "any telephone facsimile machine, computer or other device to send an unsolicited advertisement to a telephone facsimile machine." In Destination Ventures Ltd. v. Federal Communications Commission [46 F.3d 54 (9th Cir. 1995)], the Court of Appeals for the 9th Circuit upheld this portion of the law. The court established that Congress had accurately identified automated telemarketing calls as a threat to privacy, that the ban was content-neutral and narrowly tailored to advance the citizens' privacy interests and that the statute left open ample alternative channels of communications. [See also Bland v. Fessler, 88 F.3d 729 (9th Cir. 1996), VanBergen v. Minnesota, 59 F.3d 11541 (8th Cir. 1995).]

According to the court, the statute was intended, at least in part, to prevent the shifting of advertising costs from businesses to consumers. Because there was a "reasonable fit" between this governmental interest and the ban on fax advertisements and because the ban was evenhanded—it applied equally to commercial solicitation by any organization -- the court found it to be constitutional.

The Telephone Consumer Protection Act also made it unlawful in most circumstances "to initiate any telephone call to any residential line using an artificial or prerecorded voice to deliver a message." In Moser v. Federal Communication Commission [46 F.3d 970 (9th Cir. 1995)], the 9th Circuit upheld this portion of the law.

At the federal and state levels, laws prohibit spoofing and related fraudulent acts. In general, these laws have been enforced by the courts. For example, in State of New York v. Lipsitz [663 N.Y.S.2d 468 (1997)], one court held that fraud in the "rarified air of cyberspace" is no different from fraud in any other context. [See also America Online Inc. v. LCGM Inc., Civ. No. 98-102-A (E.D. Va. Nov. 10, 1998); Hotmail Corp. v. Van Money Pie Inc., No. C98-20064 JW (N.D. Calif. April 16, 1998).]

Despite the efforts of federal and state legislators to propose bills intended to impose limitations on spam, none ever became law until the Virginia statute was passed. As a consequence, most of the rules in this area have been created by the courts.

For example, in America Online Inc. v. IMS [24 F. Supp. 2d 548 (E.D. Va. 1998)], the District Court for the Eastern District of Virginia found that the sending of unsolicited bulk e-mail over a computer system, in contravention to the terms of use to which users of the system bound themselves, was an unlawful "trespass to chattels" under Virginia Common Law. [See also CompuServe Inc. v. Cyber Promotions Inc., 962 F. Supp. 1015 (S.D. Ohio 1997), which had the same holding under Ohio Common Law.]

On March 29, Virginia enacted a new anti-spam law, which goes into effect July 1. The law makes it illegal in Virginia "to transmit unsolicited bulk electronic mail in contravention of the authority granted by or in violation of the policies set by the electronic mail service provider." (See Virginia 1999 Session Laws, Chapter 904.)

This much of the new statute appears to be nothing more than the state legislature trying to take credit for what the District Court for the Eastern District of Virginia already had done in America Online v. IMS. Similarly, the new statute includes prohibitions on spoofing that are redundant with America Online v. LCGM.

Admittedly, other provisions of the new Virginia statute appear to extend the existing laws in some marginal ways. For example, it establishes civil and criminal misdemeanor penalties for violating the laws. In the end, however, the new statute does little more than reiterate the rules already established by the courts.

—Peckinpaugh is a member of the government contracts section of the law firm Winston & Strawn, Washington, D.C. This column addresses legal topics that arise in government acquisition and management of ADP resources. Readers are encouraged to submit topics by e-mail to carl@carl.com.

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