This ruling essentially allows email marketers to create multiple identities, as represented by multiple domain names, to spread out the volume of their email advertisements, reducing the volume sent via each single domain name.
This strategy fools ISPs into believing the emails emanate from multiple senders when in fact they are sent for the benefit of one entity, but doesn’t fall afoul of California law.
California law apparently sanctions this form of email marketing as long as the domain names used to send email advertisements are reflected in the header information, actually exist, are technically and literally correct, and fully traceable to a company’s marketing agents.
The Court’s ruling appears to sanction the construction of multiple email addresses to circumvent spam filters. The outcome will make it difficult for consumers to sue email marketers in California which has separate legislation which, in prohibiting fraud, is tougher than the Federal CAN-SPAM Act.
Internet phone company Vonage used it’s marketing agent to construct a list of eleven nonsense domain names for the purposes of sending unsolicited bulk commercial emails to users offering them savings on their broadband telephone services. The 11 different domain names were traced to a single physical address in Nevada where Vonage’s marketing agent was located.
The email marketing activities resulted in complaints by users when the domains bypassed their spam filters and multiple advertisements and landed in their inboxes.
A consumer Mr. Craig Kleffman initiated a class action lawsuit against Vonage Holdings in a California District Court alleging the use of these domains by Vonage was tantamount to using false header information. As none of the domains signified the origin of the messages, namely that they were from Vonage or their authorised representative, Kleffman argued they were in violation of anti-spam law.
The use of the different domains by Vonage was a transparent attempt to bypass spam filters. Vonage could have easily and less expensively sent all of its e-mail advertisements using a single domain name, and the reason it used multiple domain names was to mislead email service providers, recipients and their spam filters.
California state law makes it illegal for email headers to be falsified, misrepresented or forged. The Federal CAN-SPAM Act also renders illegal the practice of falsifying email header information.
However the Court rejected the argument that the email marketing conducted by Vonage’s marketing agent violated State anti-spam law and ruled State law was pre-empted by the US CAN-SPAM Act in any event. Whilst the Federal law prevents individuals suing for spam violations, there is an exception for state laws which relate to fraud.
Upon appeal to the Ninth Circuit the California Supreme Court then ruled that the domains were properly registered to Vonage’s marketing agent in Nevada and no violation of the Act had occurred.
The Appellant contended that the use of the domains was likely to deceive and amounted to unfair business practices as they didn’t provide any indication to either the recipient or it’s spam filter the advertisements were from Vonage. Although the emails literally and truthfully identified the sender, it was put to the Court that they were part of a calculated scheme to avoid anti-spam legislation, implying that they originated from different sources.
However the Supreme Court rejected this argument and found that the legislature didn’t intend to prohibit the use of multiple domain names with fully accurate and traceable header information. The Court simply ruled that there was no violation of law because the email advertisements didn’t contain false information. The failure to send mail from a single domain name that includes the word Vonage did not constitute a misrepresentation.
The Court ruled as follows “a single email with an accurate and traceable domain neither contains or is accompanied by misrepresented header information merely by virtue of the fact that it’s domain name is ‘random’, ‘varied’, ‘garbled’ and ‘nonsensical’ when viewed in conjunction with domain names used in other emails. An email with an accurate and traceable domain name makes no affirmative representation or statement of fact that is false”
The Email Sender and Provider Coalition, argued on Vonage’s behalf in a friend of the court brief that there was a limited and diminishing pool of available domain names. This meant that companies have little practical option other than to select one that is ‘random’ if only a random domain is available. To outlaw the practice of sending emails from non-sensical domain names would therefore be unworkable.
No related posts.