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Small Business Law Alert

USING ELECTRONIC MAIL MESSAGES IN ADVERTISING

If you send electronic mail messages to advertise or promote your business, you should become familiar with a federal law titled “Controlling the Assault of Non-Solicited Pornography and Marketing Act of 2003,” generally referred to by its acronym, “CAN-SPAM Act.” The law applies to commercial electronic mail messages, defined as “any electronic mail message the primary purpose of which is the commercial advertisement or promotion of a commercial product or service (including content on an Internet web site operated for a commercial purpose). The term “commercial electronic message” does not include a transactional or relationship message.

A compliance Guide issued by the Federal Trade Commission (FTC) states that the primary purpose of an email is transactional or relationship if it consists only of content that: (1) facilitates or confirms a commercial transaction that the recipient has already agreed to; (2) gives warranty, recall, safety, or security information about a product or service; (3) gives information about a change in terms or features or account balance information regarding a membership, subscription, account, loan or other ongoing commercial relationship; (4) provides information about an employee relationship or employee benefits; or (5) delivers goods or services as part of a transaction that the recipient has already agreed to.

The FTC Guide notes that each separate email violation of the CAN SPAM Act is subject to penalties of up to $16,000, but maintains that following the law is not complicated. The FTC summarized CAN SPAM’s main requirements as follows: (1) Don’t use false or misleading header information. Your “From,” To, ” Reply-To,” and routing information – including the originating domain name and email address- must be accurate and identify the person or business who initiated the message; (2) Don’t use deceptive subject lines. The subject line must accurately reflect the content of the message; (3) Identify the message as an ad. The law gives you a lot of leeway in how to do this, but you must disclose clearly and conspicuously that your message is an advertisement; (4) Tell recipients where you are located. Your message must include your valid physical postal address. This can be your current street address, a post office box you’ve registered with the US Postal Service, or a private mailbox you’ve registered with a commercial mail receiving agency established under Postal Service regulations; (5) Tell recipients how to opt out of receiving future emails from you. Your message must include a clear and conspicuous explanation of how the recipient can opt out of getting email from you in the future. Craft the notice in a way that’s easy for an ordinary person to recognize, read, and understand. Creative uses of type size, color, and location can improve clarity. Give a return email address or another easy internet-based way to allow people to communicate their choice to you. You may create a menu to allow a recipient to opt out of certain types of messages, but you must include the option to stop all commercial messages from you. Make sure your spam filter doesn’t block these opt-out requests; (6) Honor opt-out requests promptly. Any opt-out mechanism you offer must be able to process opt-out requests for at least 30 days after you send your message. You must honor a recipient’s opt-out request within 10 days. You can’t charge a fee, require the recipient to give you any personally identifying information beyond email address, or make the recipient take any step other than sending a reply email or visiting a single page on an Internet web site as a condition for honoring an opt-out request. Once people have told you they don’t want to receive more messages from you, you can’t sell or transfer their email addresses, even in the form of a mailing list. The only exception is that you may transfer the addresses to a company you’ve hired to comply with the CAN SPAM ACT; (7) Monitor what others are doing on your behalf. The law makes clear that even if you hire another company to handle your email marketing, you can’t contract away your legal responsibility to comply with the law. Both the company whose product is promoted in the message and the company that actually sends the message may be held legally responsible.

If you would like to receive a copy of the FTC’s 9 page Compliance Guide, contact Brian Smith by email at bsmith@werbsullivan or by phone at (302) 472-6908

This alert is for general information purposes only. It does not constitute legal or tax advice, and may not be used and relied upon as a substitute for legal or tax adviceregarding a specific problem. Advice should be obtained from a qualified attorney or tax practitioner in the jurisdiction where the advice is sought.

Werb & Sullivan Brian A. Sullivan bsullivan@werbsullivan.com
300 Delaware Avenue, Suite 1300 Duane D. Werb dwerb@werbsullivan.com
Wilmington, DE 19801 Jack J. Shrum jshrum@werbsullivan.com
Mathew P. Austria maustria@werbsullivan.com
William M. Aukamp waukamp@werbsullivan.com