The Can Spam Act and Social Media: What Every Business Should Know

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Bowie & Jensen offer their tips for what all businesses should know about social media. Businesses that advertise or promote products or services through social media should be aware of the CAN-SPAM Act. A recent federal court decision expands the reach of the Act to social media as well.

Bowie & Jensen offer their tips for what all businesses should know about social media. Businesses that advertise or promote products or services through social media should be aware of the CAN-SPAM Act. A recent federal court decision expands the reach of the Act to social media as well.

Can CAN-SPAM Act apply to social media? "Yes it can," says Bowie & Jensen’ s Kimberly S. Grimsley. “The CAN-SPAM Act applies to emails that are commercial advertisements or promotes a commercial product or service.”

Grimsley explains that the main requirements for any business sending commercial messages are:
1.     Header information should be accurate and identify the sender (person or business);
2.     The subject line should not be deceptive;
3.     Identify the message as an advertisement;
4.     Note where the recipient can locate the sender – i.e. the address;
5.     Provide how to opt out of receiving commercial emails;
6.     Comply with any opt-out request; and
7.     Monitor third parties who are sending emails on behalf of the business to make sure they, too, comply with the Act.

Grimsley adds that it appears that these requirements now apply to the use of social media; for example, in business social marketing campaigns. Recently, a federal court in California considered whether the Act applies to social networking communications where an email is not delivered to an “inbox” in Facebook, Inc. v. MaxBounty, Inc. (Northern District of California Court Case 10-Cv-04712-JF) It appears from the denial of MaxBounty’s Motion to Dismiss on the CAN-SPAM Act count that the Act applies to social media as well.

In the case 10-Cv-04712-JF, Facebook alleged that MaxBounty, through affiliates, created several Facebook pages that functioned like advertisements. They placed limited-time offers for items on their site and required users to register for the offer, involving a process that included becoming a fan of the page, inviting all their friends to join the page and then completing additional administrative requirements. Upon completion of all the steps, the user did not receive the advertised item; rather the user was directed ultimately to a third-party website as opposed to Facebook’s site. Facebook filed an action against MaxBounty for several claims, one of which was that the activity violates the Act.

MaxBounty argued that the advertisements were not email, and therefore, could not violate the Act. However, in denying MaxBounty’s Motion to Dismiss on this count, the federal court disagreed. The court noted that although no court has considered this issue directly, courts in California had rejected similar positions in two prior cases: MySpace v. Wallace (United States District Court, C.D. California No. CV 07-1929 ABC) and MySpace v. The Globe.com ( United States District Court, C.D. California No. CV 06-3391 RGK). In both MySpace cases, the court rejected the argument that the term “email” in the Act was limited in meaning to traditional emails. Rather, in both MySpace cases, the court “defined ‘electronic mail address’ as meaning nothing more specific than a destination … to which an electronic mail message can be sent…”, and stated further that “Congress was aware of the ‘various forms of electronic communications when it drafted the act’, and thus the plain language of ‘electronic mails address’ includes ‘alternate forms while also recognizing that the most commonly used form of electronic address was the traditional email’”.

In following those opinions, Grimsley said, the federal court in its recent decision noted that in order for the Facebook pages to be considered an electronic mail message, the Facebook pages “must be sent to a unique electronic address” – a destination. In the case at hand, depending on the Facebook user’s account settings, the Facebook pages were transmitted to various destinations such as a user’s Facebook “wall”, the “news feed”, the “home” page of a user’s friends, and the Facebook inbox of the user’s friends. The court found noteworthy that these transmissions required some routing on the part of Facebook, and as such the transmissions involved issues that the Act was intended to address.

Thus, companies need to aware that the Act applies to more than just the traditional emails that are commercial advertisements or promotions of commercial products and services. The requirements of the Act can also apply to a company’s social media campaign to advertise and promote their commercial products or services. Thus, a company should be familiar with the requirements under the Act and confirm that the company (or a third party on its behalf) is complying with the Act in any advertisements and commercial messages used in any social media campaigns.
Kimberly S. Grimsley is a senior associate at Bowie & Jensen and heads the Trademark Group at the firm.

Ms. Grimsley’s practice concentrates on intellectual property, Internet, computer and business law matters. Her work encompasses the protection, acquisition, use and licensing of trademarks, copyrights, and computer hardware and software. She regularly counsels clients through the entire trademark process, beginning with assessing the availability of a mark and continuing through the application process, obtaining the registration and ultimately maintaining the registration.

Policing marks is essential in protecting trademark rights. Ms. Grimsley has resolved numerous trademark disputes efficiently without litigation when possible by negotiating various co-existence, consent, and licensing agreements to protect client’s marks in a cost-effective manner. When litigation is required, she has handled opposition and cancellation proceedings before the Trademark Trial and Appeal Board. Ms. Grimsley’s experience also includes counseling clients on domain name issues, and she has counseled and handled matters through the UDRP and under the Anticybersquatting Consumer Protection Act.

About Bowie & Jensen
Bowie & Jensen is a Maryland-based law firm with attorneys representing clients around the world. Bowie & Jensen focuses on Business Litigation, Business Transactions, Intellectual Property, Employment Law, Estates & Trusts, Tax and Construction Law. For more information on Bowie & Jensen, please visit http://www.bowie-jensen.com.

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