Two controversial bills aimed at curbing spam and beefing up consumer online privacy protections are set to proceed to the Senate for debate, after being approved Friday morning by the Senate Commerce Committee.
As a result of a unanimous Committee vote, the latest version of S. 630, “Controlling the Assault of Non-Solicited Pornography and Marketing Act,” or CAN-SPAM, has come closer to becoming law than any other bill aimed at curbing unsolicited commercial e-mail.
At the same time, a divided Committee also approved S. 2201, “The Online Personal Privacy Act,” the approval of which initially had been challenged by Republicans. But an agreement by the bill’s sponsor, Sen. Ernest “Fritz” Hollings (D-S.C.), to support CAN-SPAM evidently lent the bill enough bi-partisan support to continue.
A factor in the alliance stemmed from both bills having come under fire from business interests eager to limit federal regulation of online consumer privacy, marketing and e-mail, Congressional sources said.
CAN-SPAM, sponsored by Sen. Conrad Burns (R-Mont.), requires online marketers to honor a request by a user to opt-out of mailings within 10 days of receiving the request, or be faced with fines. The bill also requires that marketers include a working return address, opt-out information, and a physical address in any mailing. It also forbids false or misleading subject lines.
For violators of the Act, the Federal Trade Commission can impose steep civil fines of up to $10 per e-mail message, up to an overall cap of $500,000. If a court finds that the marketer willfully violated the Act, this amount could be tripled.
In addition, Internet Service Providers would have a right to sue spammers for damages, while states also would be able to bring suit on behalf of their citizens.
“My bill strangles out spam e-mail by imposing steep fines and empowering consumers with the choice to close their doors to hyper-marketing once and for all,” Burns said in a statement. “Rampant pornography and fraudulent credit deals were never the destiny of the Internet, but they have become commonplace fixtures for inboxes everywhere. Finally, Congress can do something about this: on this issue either you are for the consumer or against the consumer. There is no middle ground.”
Burns also said Friday’s vote represented a victory for ISPs and rural consumers, many of whom he said pay long-distance charges for Internet connections, which they “waste” by being forced to spend time sifting through unwanted e-mail.
“Spam has made it harder for rural America to flourish in the digital age. And it has also flooded the system’s Internet Service Providers, causing network shutdowns that cause incalculable economic damage to e-commerce,” he said.
The Online Privacy Act, meanwhile, requires marketers to get consumers’ explicit permission before collecting or sharing personal information such as political or religious beliefs, sexual orientation or credit card history. Less sensitive information, such as buying preferences, can be shared with third parties unless the user opts out.
Like CAN-SPAM, the Online Privacy Act provides legal recourse for consumers, who can sue for up to $5,000 for misuse of data.
While Hollings and supporters of the bill maintain that it will encourage consumer confidence in e-commerce, marketers and online firms oppose the Act out of concerns that they would be saddled with excessive liabilities.
For instance, drugmaker Eli Lilly last year inadvertently disclosed the e-mail addresses of 669 Prozac users. While the company faced only FTC criticism for the oversight, under the Online Privacy Act, the company potentially would have been subject to more than $3 million in consumer damages.