Could Routine Electronic Messages Expose A Company To Legal Violations?
Routine business communications, especially those transmitted electronically, may have advertising and promotional implications incorporated within them. For example, a toy manufacturer may send an email confirmation of an order and include language at the bottom promoting its most recent line of plush toys. Messages like these that contain promotions or advertising may have unintended consequences by unintentionally increasing the risk of legal violations.
You may have heard of The Can-Spam Act (“Can-Spam”), but if your business engages in email marketing, you must understand the requirements and put processes in place for compliance. Can-Spam is a federal law that establishes requirements for all outbound commercial messages, regardless of whether they are B to B (business to business) or B to C (business to customer) messages. The Act also provides recipients the right to have you discontinue your emails to them, which is referred to as an “opt-out” provision. Finally, it instills high penalties for non-compliance.
The main requirements of Can-Spam are as follows:
Header or subject line information must NOT be misleading.
The subject line must be an accurate descriptor of the content of the message.
Clear and Conspicuous identification that the message is an ad.
Recipients must be provided your address.
You must include an Opt-Out mechanism to avoid future messages.
Opt-out requests must be honored promptly (i.e. within 10 business days).
If you hire another company to handle your e-mail marketing, you are responsible for their compliance with Can-Spam.
Penalties for Non-Compliance:
Each separate email message that does not comply with Can-Spam may be the subject of up to $40,000 or more in penalties, and multiple people may be responsible for violations. Therefore, both the company whose product or service is being advertised and the marketing company who originated the message may be legally responsible for violations. In addition to the requirements of Can-Spam, commercial email messages must comply with other laws as well. For example, if the content is deceptive or misleading information about a product, then the sender may be in violation of the FTC Act and/or other state laws regarding false and deceptive business practices. Further, impersonation or the unauthorized use of the sender’s computer or system or other such acts are subject to criminal penalties.
Not all commercial messages require compliance with Can-Spam. Only those messages whose primary purpose is commercial in nature. For instance, emails to customers concerning their order, or other already agreed-to transaction with your company will avoid the necessity to comply with Can-Spam as they are viewed as relationship or transactional messages. However, oftentimes a business will send a message that combines elements of transactional or relationship content with commercial content. For example, in an abundance of caution, a toy manufacturer may elect to adopt policies that prohibit customer order communications from also containing marketing or promotional messages. Or, processes could be put in place to ensure that the manufacturer makes all communications compliant with the Can-Spam Act. At that time, it is important to consult with an attorney for guidance as to whether such a message must comply with Can-Spam or if the message would not fall under the purview of Can-Spam.
Please contact us with any further questions or to inquire about our fixed-fee advertising clearance services.
Natalie A. Remien
180 N. LaSalle St. Suite 3200
Chicago, Illinois 60601