Asta Viewpoint: Victory in Can-Spam Case Underscores Complex Issue

SPONSORED BY THE AMERICAN SOCIETY OF TRAVEL AGENTS

Meeting the needs of today's competitive digital marketplace and at the same time balancing the ever-increasing regulatory requirements is a tricky dance for even the savviest of businesses. This dance eventually evolved into a complex tango for Omega World Travel, which also owns and operates Cruise.com, when we were sued by an anti-spam crusader.

Without question, digital marketing is the most cost-effective marketing tool available to businesses. It is the cost-effectiveness that has everyone, including legitimate businesses, as well as fraudsters, using this remarkable tool to capture the attention of anyone with an active e-mail account and time on their hands.

For Omega, as well as most businesses, e-mail is used to both communicate with customers and to market to potential clients. While these two groups are distinct, both groups may be impacted by spam when a company's e-mail servers are bombarded with a large number of e-mails at any one time. The system may either slow down or, in some cases, become completely disabled. While a delay in a marketing message may be acceptable, a delay in a communication between an agency and its customer can be devastating. This significantly affects agencies that do thousands of transactions a day and who cannot afford even the slightest disruption in service. More importantly, most agencies certainly cannot afford to miss or fail to book a transaction because of a failure in the e-mail system.

To help minimize this problem, agencies can either outsource their e-mail service or add additional servers. In some cases, outsourcing makes sense, as a service provider may maintain thousands of e-mail servers. Their capacity to receive e-mails is so great that the chance of a series of bulk e-mails clogging the system is very slim. The other option is to increase server capacity at your company. Either solution is workable and hopefully will protect against a disruption.

How can a company legally use commercial e-mail as an advertising tool? The answer to this question is to comply with the Can-Spam Act. While managing the operational issues associated with sending and receiving e-mails is important, it is critical that all businesses have an understanding of their regulatory obligations. The Controlling the Assault of Non-Solicited Pornography and Marketing Act of 2003 regulates e-mail marketing, and is, as the title suggests, a complicated law. Organizations, like ASTA, have provided guidance for their members. See, for example, http://www.astanet.com/members/center/legal_spam.asp.

Omega's recent litigation, which we successfully defended, illustrates the conflict that often occurs between state and federal regulatory acts. In our case, an anti-spam crusader charged Omega with violating the Can-Spam Act and Oklahoma's anti-spam law. In the end, Omega was found to be in compliance with the federal government's Can-Spam Act, but, just as important, the court also noted that the Can-Spam Act preempted Oklahoma's anti-spam law. For cases like this going forward, this will be an important precedent.

How can a company avoid being labeled a spammer? This answer is a little more complicated. I suppose that anyone can accuse a company of being a spammer, but with the success we have had and a finding by the court that calling someone a spammer is defamation, the risk of being called a spammer for simply sending legitimate commercial e-mail has been reduced significantly.

Even though e-mail marketing has evolved and regulations have been enacted, there will be those that continue to challenge and test the law. As a result, all businesses, not just travel agents, must remain vigilant and ensure their compliance with the Can-Spam Act of 2003. While Omega won this round of the dance competition, we continue to prepare for future challenges, as well as opportunities, that come our way.